A Treasury U-turn on the pension reforms will mean there is more chance that savers will avoid costly fines, a regulatory expert says.

The Treasury's announcement today that it is abandoning requirements on savers to contact all previous pension providers when accessing new freedoms should also prevent time wasted at HMRC, according to a senior Aegon boss.
Under the Taxation of Pensions Bill amendments tabled last month savers were told they must contact all their existing pension providers within 31 days of accessing their new freedoms. They faced £300 fines or more for failing to do so.
This was to ensure that providers took account of the tax implications when flexible pension pots were accessed causing the annual tax relief allowance to be reduced from £40,000 a year to £10,000.
In amendments tabled by Chancellor George Osborne yesterday, the Government will now only require savers to contact providers who they are currently contributing to or those and those which they contribute to in the future.

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Also the deadline for doing this will be extended to 91 days – although savers who fail to meet this deadline will still face a fine of £300 plus £60 for each subsequent day beyond that.
Kate Smith, regulatory strategy manager at Aegon, said those who choose to access their pension have a far better chance of avoiding fines now that the rules will require them only to contact pension providers they actively contribute to.
She said: "The change of stance represents a win for common sense and will mean people are not penalised for taking advantage the new pension flexibilities.
"Today's workforce tend to have multiple employers over their career meaning pensions are spread across different providers pension schemes and unfortunately not everyone keeps close tabs on their smaller or older pots.
"By asking people to contact only those pension providers where they are actively contributing savings, the Government is giving people a much better chance of avoiding costly fines and won't be clogging up HMRC's time."
Barnett Waddingham also welcomed the Treasury's announcement, with its senior consultant Malcolm McLean saying: "The revised rules are now much more pragmatic whilst still providing the necessary protections the Treasury require. This is clearly a victory for common sense".

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