Pension liberation adviser Paul Baxendale-Walker is appealing against a High Court ruling that closed his scheme.
Baxendale-Walker is challenging the judge’s decision and an injunction granted the The Pensions Regulator (TPR) to stop the former lawyer and media entrepreneur from running alleged pension liberation businesses.
The appeal follows a decision in the High Court earlier this year declaring four pension schemes – A Admin, Warwick Pensions Administration, Lincoln Pensions Administration and Baxendale-Walker LLP- as void.
Judge Vivian Rose decided the schemes offered uncertain outcomes to members which left no choice other than to close them.
In the case, TPR alleged the schemes were ‘misuse and misappropriation’ of pension scheme assets.
Defrauding pensioners
Baxendale-Walker’s solicitor Jonathan Sachs, of law firm Irwin Mitchell, said: “He has devised a scheme where pensioners could liberate their pension funds without buying an annuity.
“The evidence from TPR was that Paul was defrauding the pensioners because he was taking significant fees and they would be met with very large penalties from HMRC.
“We say those allegations were false. TPR knew they were false when they represented because they were much lower than normal pension fund fees. There was no tax penalty.”
TPR declined to comment about an ongoing case.
The next step in Baxendale-Walker’s challenge is to ask the court to proceed with the appeal.
He pledged in court not to continue with the pension liberation scheme because Chancellor George Osborne’s Budget 2014 pension reforms already allow early access to cash for the over 55s with defined contribution schemes.
One of the measures was to remove the 55% tax charge on withdrawing funds early from a pension.
Struck-off lawyer
Instead, retirement savers receive the first 25% of their total pension funds tax-free and then pay income tax at their marginal rate on the remaining cash as they draw it down.
Baxendale-Walker trained as a lawyer but was struck off on the grounds he was involved in a conflict of interest in advising clients about his own tax schemes.
He was also involved in adult film production and formerly owned the magazine Loaded.
Meanwhile, TPR and HM Revenue & Customs (HMRC) are involved in an ongoing campaign to alert retirement savers to issues with pension liberation schemes.
‘Pension Predators’ explains that pension liberation often has a costly sting in the tail as some operators levy fees of up to a third of the transfer balance and HMRC penalises under 55s for accessing their pension funds early with tax charges.
