Osborne pledges to scrap “death tax”

Among the sexting scandals and defections to UKIP, the Tory party struggled to get its voice heard this weekend.

However, one policy that struck a chord with some voters was plans announced by Chancellor George Osborne to change pensions rules, meaning more money can be passed on to relatives after a person has died.

Osborne said he will abolish the 55% tax on pension pots left by savers when they die – sometimes known as the “death tax”.

It means people savers will get to pass on spare money they haven’t spent during their elderly years, but has also been criticised as children of wealthy parents will be in line for bigger windfalls from April 2015.

Osborne said: “People who have worked and saved all their lives will be able to pass on their hard-earned pensions to their families tax free.

“The children and grandchildren and others who benefit will get the same tax treatment on this income as on any other, but only when they choose to draw it down.”

The move will cost £150m a year – and the chancellor hasn’t yet revealed how he will pay for it.

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