Jupiter has claimed that married couples can increase their retirement income by divorcing! They have said that if a married couple, one with a pension pot of £1 million and the other with no taxable income, have a gross retirement income of £76,670, the net income will be £54,268 after the deduction of £22,402 in higher rate tax. But if the same couple were to divorce and split the pension pot equally between them, they would receive a net income of £31,267 each as basic rate taxpayers. This would give them a joint income of £62,534, giving an annual tax saving of £8,266. But the company have also said that it would be "prudent| for the couple to marry again later in life so they do not lose the inheritance tax advantages for transfers between spouses.
Our view
This is a dangeous game. Certainly, this is an area we have explored at in the past and well understand the financial numbers. However, we feel that if people start to abuse the system, the Government will change the law. In addition there is the risk that your partner may not actually want you back!