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| Version 4 | Version 5 |
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| George Osborne to cut 55% pension 'death tax' | George Osborne to cut 55% pension 'death tax' |
| (35 minutes later) | |
| Pensioners will be able to leave more of their money to the next generation from next April, George Osborne is to announce at the Tory conference. | Pensioners will be able to leave more of their money to the next generation from next April, George Osborne is to announce at the Tory conference. |
| The chancellor will abolish a 55% tax that currently applies to untouched "defined contribution" pension pots left by those aged 75 or over, and to pensions from which money has already been withdrawn. | The chancellor will abolish a 55% tax that currently applies to untouched "defined contribution" pension pots left by those aged 75 or over, and to pensions from which money has already been withdrawn. |
| Inheritors will now only pay the marginal income tax rate, or no tax at all if the deceased was under 75 and the pension is left untouched. | Inheritors will now only pay the marginal income tax rate, or no tax at all if the deceased was under 75 and the pension is left untouched. |
| The Treasury predicts the new policy will cost approximately £150m per year. | The Treasury predicts the new policy will cost approximately £150m per year. |
| The idea was first floated in July, when a consultation was launched. | The idea was first floated in July, when a consultation was launched. |
| Also on day two of the Conservative conference in Birmingham: | |
| Mr Osborne is attempting to shift the focus on to policy after a day dominated by the fallout from MP Mark Reckless's defection to UKIP. | Mr Osborne is attempting to shift the focus on to policy after a day dominated by the fallout from MP Mark Reckless's defection to UKIP. |
| Senior Conservative MPs and cabinet ministers lined up to criticise Mr Reckless, with party chairman Grant Shapps accusing him of "betrayal" and Commons leader William Hague saying his decision was "hypocritical". | Senior Conservative MPs and cabinet ministers lined up to criticise Mr Reckless, with party chairman Grant Shapps accusing him of "betrayal" and Commons leader William Hague saying his decision was "hypocritical". |
| Mr Reckless has said he no longer trusts David Cameron to deliver on immigration, cutting taxes and Europe - and like previous defector Douglas Carswell - he will seek to return to the Commons as a UKIP MP in a by-election. | Mr Reckless has said he no longer trusts David Cameron to deliver on immigration, cutting taxes and Europe - and like previous defector Douglas Carswell - he will seek to return to the Commons as a UKIP MP in a by-election. |
| Speaking on BBC Radio 4's Today programme, Mr Osborne said the way to resolve the debate over Europe was to hold a referendum on the UK's membership - as promised by the Conservatives. | Speaking on BBC Radio 4's Today programme, Mr Osborne said the way to resolve the debate over Europe was to hold a referendum on the UK's membership - as promised by the Conservatives. |
| He said there was a "wide range of opinions" and some "very strong views" in the business community about Europe. | He said there was a "wide range of opinions" and some "very strong views" in the business community about Europe. |
| "If we did not think it was in Britain's interests to be in the European Union, we would not argue for it," he said. | "If we did not think it was in Britain's interests to be in the European Union, we would not argue for it," he said. |
| Mr Osborne compared the pledge of a referendum with the recent vote on Scottish independence, saying "the march of the separatists" was "reversed" by the 'No' vote. | Mr Osborne compared the pledge of a referendum with the recent vote on Scottish independence, saying "the march of the separatists" was "reversed" by the 'No' vote. |
| And on the economy, he said it was a "dangerous myth" that the link between economic prosperity and people's personal finances had been broken. | And on the economy, he said it was a "dangerous myth" that the link between economic prosperity and people's personal finances had been broken. |
| The Conservatives want to use their final conference before a general election to unveil policies - on housing, apprenticeships and pensions - that demonstrate they are on the side of hard-pressed voters and not just focused on cutting the deficit. | The Conservatives want to use their final conference before a general election to unveil policies - on housing, apprenticeships and pensions - that demonstrate they are on the side of hard-pressed voters and not just focused on cutting the deficit. |
| 'Hard-earned pensions' | 'Hard-earned pensions' |
| In a move expected to go down well with core Conservative voters, Mr Osborne is setting out plans to abolish the 55% tax charged when people pass on a pension pot. The government estimates that the changes are likely to affect 320,000 people. | In a move expected to go down well with core Conservative voters, Mr Osborne is setting out plans to abolish the 55% tax charged when people pass on a pension pot. The government estimates that the changes are likely to affect 320,000 people. |
| Mr Osborne will say: "People who have worked and saved all their lives will be able to pass on their hard-earned pensions to their families tax free. | Mr Osborne will say: "People who have worked and saved all their lives will be able to pass on their hard-earned pensions to their families tax free. |
| "The children and grandchildren and others who benefit will get the same tax treatment on this income as on any other, but only when they choose to draw it down. | "The children and grandchildren and others who benefit will get the same tax treatment on this income as on any other, but only when they choose to draw it down. |
| "Freedom for people's pensions. A pension tax abolished. Passing on your pension tax free. | "Freedom for people's pensions. A pension tax abolished. Passing on your pension tax free. |
| "Not a promise for the next Conservative government - but put in place by Conservatives in government now." | "Not a promise for the next Conservative government - but put in place by Conservatives in government now." |
| Analysis: Simon Gompertz , BBC personal finance correspondent | Analysis: Simon Gompertz , BBC personal finance correspondent |
| The end of the 55% tax charge will be a significant gain for some. | The end of the 55% tax charge will be a significant gain for some. |
| But the question Mr Osborne will have to answer is whether he is creating a way for better-off savers to escape tax. | But the question Mr Osborne will have to answer is whether he is creating a way for better-off savers to escape tax. |
| They will have an incentive to use money stored in bank accounts and investments before dipping into the pension pot. | They will have an incentive to use money stored in bank accounts and investments before dipping into the pension pot. |
| The reason? The pension will become a way of protecting up to £1.25m from some or all tax after death. | The reason? The pension will become a way of protecting up to £1.25m from some or all tax after death. |
| Those on lower incomes, who can't save much, and need the money during retirement, have not been in danger of paying the 55% and are unlikely to benefit from its removal. | Those on lower incomes, who can't save much, and need the money during retirement, have not been in danger of paying the 55% and are unlikely to benefit from its removal. |
| Some experts say the Osborne reforms turn pension saving on its head. | Some experts say the Osborne reforms turn pension saving on its head. |
| The point used to be to spread your income over your lifetime. | The point used to be to spread your income over your lifetime. |
| In future, pensions could become a method of preserving savings beyond the grave. | In future, pensions could become a method of preserving savings beyond the grave. |
| The scrapping of the 55% rate is the latest in a string of changes to pension regulations introduced by George Osborne. | The scrapping of the 55% rate is the latest in a string of changes to pension regulations introduced by George Osborne. |
| In March's Budget, the chancellor announced that pensioners would have the freedom to cash in as much or as little of their pension pot as they wanted, removing the need to buy an annuity. | In March's Budget, the chancellor announced that pensioners would have the freedom to cash in as much or as little of their pension pot as they wanted, removing the need to buy an annuity. |
| The latest measure will apply to all inherited pensions received from April 2015. | The latest measure will apply to all inherited pensions received from April 2015. |
| The beneficiaries of anyone who dies before that date may also benefit from the tax cut, if payment is delayed until after the new policy comes into effect. | The beneficiaries of anyone who dies before that date may also benefit from the tax cut, if payment is delayed until after the new policy comes into effect. |
| It says 12 million Britons have some form of defined contributions pensions saving. | It says 12 million Britons have some form of defined contributions pensions saving. |
| Spouses and financially dependent children under the age of 23 are already exempt from the 55% tax, but the new policy introduces the following changes: | Spouses and financially dependent children under the age of 23 are already exempt from the 55% tax, but the new policy introduces the following changes: |
| Mr Osborne will also attack the credibility of Labour's economic policies, saying: "The idea that you can raise living standards, or fund the brilliant NHS we want, or provide for our national security without a plan to fix the economy is nonsense. | Mr Osborne will also attack the credibility of Labour's economic policies, saying: "The idea that you can raise living standards, or fund the brilliant NHS we want, or provide for our national security without a plan to fix the economy is nonsense. |
| "It's the economy that builds houses. It's the economy that creates jobs. | "It's the economy that builds houses. It's the economy that creates jobs. |
| "It's the economy that pays for hospitals. It's the economy that puts food on the table. | "It's the economy that pays for hospitals. It's the economy that puts food on the table. |
| "That's why it's the economy that settles elections. And the Conservatives are the only people in British politics with a plan to fix the economy." | "That's why it's the economy that settles elections. And the Conservatives are the only people in British politics with a plan to fix the economy." |
| For Labour, Chris Leslie. shadow chief secretary to the Treasury, said: "George Osborne claims he has fixed the economy, but he's only fixed it for a privileged few at the top." | |
| What is your reaction to George Osborne's proposals? You can email your comments to haveyoursay@bbc.co.uk | What is your reaction to George Osborne's proposals? You can email your comments to haveyoursay@bbc.co.uk |