UK savers are dangerously underestimating the minimum amount needed to retire, according to research from pension provider PensionBee.

A survey of 1,000 working-age UK adults showed that 23% were unsure of the total pension pot size needed to achieve the retirement income they desire.

Pension Bee said that, according to the Pensions and Lifetime Savings Association’s (PLSA) Retirement Living Standards, a pension pot of £150,000 would only fund an individual’s minimum retirement standard for ten years. Pension Bee suggested that working-age adults could be underestimating the true cost of retirement.

49% of those polled estimated that they would require a pension pot of around £250,000 or more. However, Pension Bee found that there was a lack of clear consensus in regard to desired annual income in retirement.

Becky O’Connor, Director of Public Affairs at Pension Bee, said:

‘It’s hard to plan for retirement without an idea of how much you might need, yet most Brits seem to be unaware of – or worse, dangerously underestimate – the true cost of retirement.

‘A good pension pot is one that can provide enough money for the duration of retirement. As this exact amount will vary based on individual circumstances, pension calculators can be a helpful tool in setting financial goals and adjusting behaviours to achieve them.

‘However, one rule is broadly true: the earlier individuals start paying into a pension, the more likely they are to be able to afford their desired lifestyle, as their pension has longer to grow and the amount they’re required to save each month reduces.’

Internet link: PensionBee

The UK’s business groups have pledged to work in partnership with the new Labour government to revitalise the nation’s economy.

Labour leader Sir Keir Starmer is the new Prime Minister after leading the party to a decisive win in the General Election.

Shevaun Haviland, Director General of the British Chambers of Commerce (BCC), said:

‘Congratulations to the Labour Party on their victory after a long and hard-fought campaign.

‘The public have delivered them a clear and decisive parliamentary majority – hopefully they will use this mandate to provide the stability and certainty businesses crave.

‘How we revitalise our economy was hotly debated throughout the past six weeks, and it is encouraging to see they have many policies which clearly align with our recommendations.

‘But after a gruelling election the really hard work starts now. We need to see action from day one on pulling together a coherent industrial strategy for the long-term, which places a strong emphasis on harnessing green innovation.

‘Closing the skills gap, growing exports, boosting productivity and harnessing the power of AI won’t happen overnight.’

The Confederation of British Industry (CBI) also congratulated Starmer and Labour on their victory.

Rain Newton-Smith, CBI Chief Executive, said:

‘Delivering sustainable growth should be the defining mission for the new government. Business stands ready to bring its innovation, ideas, and investment to make that shared mission a reality.

‘Building a partnership for prosperity between government and business holds the key to unlocking a revitalised pitch to global investors.

‘By working with business, the new government can deploy the capability and capacity of industry to deliver the connected transitions across net zero, the digital economy, and the future of work needed to put the economy on a pathway to sustainable growth.’

Internet link: BCC CBI

The UK’s tax gap estimate rose to a record to £39.8 billion in 2022/23 as small businesses accounted for almost two thirds of unpaid tax, according to HMRC’s data.

The tax gap was 4.8%, which is the difference between the amount of tax that should be paid to HMRC and what is actually paid.

The tax gap estimate for corporation tax for small businesses rose to £10.9 billion, while the tax gap for total corporation tax was £13.7 billion.

John Barnett, Chair of the Chartered Institute of Taxation’s Technical Policy and Oversight Committee, said:

‘Critics of HMRC can point to a record amount – nearly £40 billion – not being collected, but HMRC can legitimately point out that they are bringing in a record share of the expected tax take.

‘That both these things can be true simultaneously tells us more about current tax levels than anything else.

‘These figures show there is plenty of work for HMRC to do in a range of areas to reduce the tax gap. However, we should not lose sight of the fact that their record, collecting more than 95% of tax due, compares well internationally.’

Internet links: GOV.UK Chartered Institute of Taxation

HMRC has not fined a single enabler of offshore tax evasion in five years, data released in response to a Freedom of Information (FOI) request has revealed.

This is despite HMRC having landmark powers, which were introduced in 2017, to impose hefty fines.

The data, which was released to the Bureau of Investigative Journalism (TBIJ), suggests that HMRC is failing to target the creators of offshore tax evasion schemes and instead pursues clients of such schemes.

According to the FOI request, HMRC has not fined a single partnership or company for enabling tax evasion since the change in the law in 2017.

Michelle Sloane, a tax disputes partner at law firm RPC, said:

‘Enablers were and still are a big focus for HMRC. But these figures show their rhetoric on tackling enablers … is clearly not being followed through with action.’

A spokesperson for HMRC said:

‘We have a strong track record in tackling offshore non-compliance. Since the launch of our No Safe Havens strategy in 2019, we have secured almost £700 million from offshore initiatives.’

Internet link: TBIJe

The UK economy grew by more than initially estimated at the start of this year, according to figures from the Office for National Statistics (ONS).

The economy grew by 0.7% between January and March 2024, up from the previous figure of 0.6%. Growth in the UK services sector helped to push it even higher, the ONS said.

The positive news on growth followed the UK inflation rate falling to its lowest level in almost three years.

According to the ONS, the Consumer Prices Index (CPI) rose by 2% in the year to May 2024, down from 2.3% in April.

The data showed that whilst prices are still rising, they’re increasing at their slowest pace since July 2021.

David Bharier, Head of Research at the British Chambers of Commerce (BCC), said the data is ‘a further sign that the UK is exiting the inflation crisis which began in late 2020’.

He continued: ‘It provides additional weight for an interest rate cut in the coming months, something which will be welcomed by firms of all shapes and sizes.

‘Our research has shown that a steadily declining number of businesses are concerned about inflation, from a record peak of 84% in mid 2022. This is positive news, but prices are not falling, just rising more slowly, and the economic outlook remains challenging.’

Internet links: ONS ONS BCC