Scotland has voted to stay in the United Kingdom, but this No vote will not mean no change for pension schemes, actuaries have warned.
In yesterday's ballot the people of Scotland rejected independence by 55% to 45%, after a two-year campaign. The resulting vote means that Scotland will remain part of the UK, however, changes to income tax promised by the three main Westminster parties 'will have interesting consequences for pension plans and their sponsors', actuarial firm Towers Watson said.
According to Towers Watson, stronger tax-varying powers for the Scottish Parliament could affect both tax relief on pension contributions and the tax due on pension payments.
Commenting on the result, senior consultant Arthur Zegleman said: 'Even before the unionist parties committed themselves to "home rule", Holyrood was due to get more powers over income tax from 2016. UK tax rates are set to fall in Scotland, with a new Scottish rate introduced. If the Scottish tax rate were anything other than 10p in the pound, incomes taxes would differ north and south of the border.'
Scotland has had limited powers to vary income tax for the past 15 years, but has yet to use them, Zegleman noted. He called on schemes to be ready for when this 'was no longer just a hypothetical challenge'.
'Until 2018, HMRC plans to make uniform payments regardless of where the individual lives and balance things out by adjusting how much tax it takes out of their pay, but that is only a temporary sticking paper.'
Barnett Waddingham urged pension schemes not to rest easy on the decision.
Partner Mike Kennedy said: 'The prospect of schemes operating across the Scottish border being forced to meet stricter funding requirements has now fallen away. However, pension schemes and their sponsoring employers should not rest easy.
'The Scottish Parliament was promised additional powers from Westminster in the run-up to the vote and it is likely that they will seek to use them. If differences arise in legislation and taxation between Scotland and the rest of the UK, this will lead to complications for administering schemes with members in both regions, and therefore increased costs.'
Tom McPhail, head of pensions research at Hargreaves Lansdown, urged investors who had the means to take advantage of tax breaks on pensions to make the most of them while they can.
He said the expected devolution of powers from Westminster to Scotland could lead to regional tax powers which could in turn impact on pensions and other savings plans.
'State pension levels and qualification ages will apply across the UK in accordance with the government's existing plans. Scottish pensioners will now be denied the possibility of drawing their state pension a year or two ahead of their counterparts in the rest of the UK. The government's plans for the pension freedoms announced in the budget will all be implemented this side of the general election and remain on track.'
At the Institute and Faculty of Actuaries (IFoA), leader of the Scottish board Martin Potter said yesterday's referendum was a momentous occasion in the history of Scotland and the UK.
'The Scottish electorate has spoken and, while independence was not the outcome, there is clearly an appetite for constitutional change.
'The IFoA looks forward to playing its part in informing the debate in areas where actuaries provide expertise such as insurance, pensions, and risk management, both in a regulatory capacity and the implications for the future growth of the financial services sector.'