There can be numerous problems and difficulties when pensions and investment companies are taken over or bought out or if part of their business is taken over by another company.
In a recent case, our clients had established a Child Stakeholder Pension for their daughter with Legal and General a number of years ago. Legal and General has since ‘sold’ their pensions book to Reassure who now manage those pensions.
In the above case, when the pension was taken over and merged into Reassure’s systems, it did not migrate across correctly and Reassure then had the same pension in the mother’s name and not the daughter’s name. The mother has already made the maximum pension contributions for herself in her own name for this tax year.
By then putting the Child’s Stakeholder Pension also in the mother’s name, it meant that the mother had technically made excess pension contributions over and above the pensions annual allowance and would face a tax penalty.
The client contacted us for help and we then contacted Reassure who denied that it was a child’s pension and had no record that the pension merged across from L&G to Reassure was in fact a child’s pension plan.
We had to argue, prove the same and eventually we have got there and the error is being corrected.
If your pension or investment policy has been taken over by another firm, you need to check that all is correct and the two respective companies have the policy set up in exactly the same way and names as the original. The above problem and others, as yet unknown, could be a problem for many without double checking.
We were not involved, this was not an advised transfer, this was simply a company buying another company’s business and their merge systems have clearly missed this critical issue.
When your investment or pension company is taken over by another, always check that your policy has migrated over correctly.