Indications by the FSA that they will monitor this type of business closely have also led to brokers referring equity release clients to specialist firms to limit their own liability.
Colin Taylor, managing director at Key Retirement Solutions, said: “The enhancements made to the service will benefit both broker and customer alike as we will be able to provide them with the information and advice they need faster and more efficiently than in the past.”
Mike Gosnall, managing director at Lifelink Group, said: “As a mainstream mortgage provider we believe that our clients should receive the best possible service and advice from a specialist equity release broker.”
· Safe Home Income Plans (SHIP) has announced it believes income from home reversion schemes will not be taxed.
Graeme Marshall, chairman of SHIP’s home reversion board, said: “SHIP announces that reports in the press of a tax on income from home reversion plans may be misleading.
“SHIP is in talks with the Inland Revenue to discuss the exemption of home reversion plans from Schedule 15 of the Finance Act 2004. We are confident that the position will shortly be resolved in favour of existing and future reversion plan holders.”
Schedule 15 of the Finance Act 2004 concerns regulation often referred to as Pre-Owned Asset Tax. This legislation is designed to close a tax loophole and prevent tax avoidance in estate planning.
Home reversion plans are primarily designed to provide cash lump sums for the elderly to improve their lifestyles rather than avoid inheritance tax.
