A pensioner who had built up savings of almost £50,000 in a Virgin Money stakeholder pension was left with less than £15,000 after falling foul of tax rules.

A pensioner who had built up savings of almost £50,000 in a Virgin Money stakeholder pension was left with less than £15,000 after falling foul of rules that required him to take an income before his 75th birthday. Virgin deducted almost £35,000 in tax, as required by law, when the pensioner – named by the Pensions Ombudsman only as K Finn – failed to move his money to an annuity company before the deadline. From his pension pot of £49,169, Mr Finn was sent a cheque for just £14,760 by Virgin. The rules have since been relaxed and people approaching 75 now do not have to take any action to avoid similar penalties. Previously, pension savers had to buy an annuity by the age of 75, or opt for an alternative means of taking an income. If they did nothing, they were liable to a huge tax charge. Mr Finn took his case to the ombudsman, but lost......Read more here