An obscure tax technicality means many low paid workers miss out on Government pension top-ups, while higher earners get them automatically. Ex-Pensions Minister and campaigner Ros Altmann has raised the alarm, stirring a chorus of support from other financial experts who say this anomaly must be fixed. And this week, a Department for Work and Pensions spokeswoman promised the House of Lords that the Government would look at the issue.
Do you talk to your partner about retirement? A quarter of couples aged over 40 never discuss what they will live on in old age
Running out of money is their biggest concern about retirement, with 46 per cent citing this as a worry, while 28 per cent are anxious about making mistakes in retirement planning. One in 10 couples revealed they had no private retirement savings.
HAMISH MCRAE: It's time for wealth to pass down the ages... but there's a divide between parents with own homes and without
Provided you have chosen the right parents, it is not so bad being a millennial. The calculation that five million people born between 1973 and 1993 will on average inherit £233,000 from their parents gives a new twist to the Bank of Mum and Dad story.
Savers investing pensions must be told annual charge in 'pounds and pence', says watchdog
A cap on drawdown charges has not been ruled out, if firms don't set 'appropriate' charges themselves, according to the Financial Conduct Authority. Other proposals to help savers include changes to 'wake-up packs' that pension firms send to people approaching retirement. It says these should be introduced from age 50, include a single page summary of their savings - known as a 'pensions passport' - and be resent to savers every five years.
Are you stuck with a frozen pension?
Business owner whose pot is STILL £15,333 after 12 YEARS urges fellow savers to join his campaign for fair treatment
James Hawken, 49, wants to rally support among pension savers left out of pocket, pile pressure on politicians to investigate and potentially launch legal action against providers. In a case highlighted by This is Money last year, he has not seen a penny of growth on his £15,333 pension pot with Phoenix Life for years, while shelling out 2 per cent in annual fees. He would have to forfeit 17 per cent of the fund if he moves it before he is 55.
ASK STEVE WEBB A PENSION QUESTION
Can my wife claim some of her late ex's pension? They split their assets amicably without going to court but then he died
During the divorce the assets except his pension were amicably split 50/50. As this was his only income my wife agreed that he could keep the pension. But this was a private agreement and was made without any expectation that he would be diagnosed with cancer and die only a few years later. Does my wife have a legal claim on the pension?
STEVE WEBB ANSWERS YOUR PENSION QUESTIONS
- I used to work at a care home that went bust, so how do I track down my pension?
- Help! I put my husband's name first on child benefit form and lost some state pension
- Should I have inherited some of my husband's state pension after his death?
- Before their marriage my sister's husband nominated his work pension death benefits to go to his mum: if he dies who will get it?
- Why won't I get a full state pension even though I paid National Insurance for 38 years?
- What happens to my state pension if my husband moves into a care home?
- How do I set up a pension from scratch?
- I work part-time, care for my disabled husband and pay the 'married woman's stamp': What state pension will I get at retirement?
- My state pension was just 11p a week! It went up when my husband retired, but should my years as a mother count too?
- Investing my pension pot at retirement sounds risky - can I just put it in cash?
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MORE PENSIONS NEWS AND TIPS
Call for cheap and easy 'default' pension investing rebuffed by Government - but a 0.75% charges cap is still under review
City watchdogs are currently probing drawdown products and whether to curb charges by setting a formal cap, and the Government said it would wait for and fully consider those findings. MPs had called for any pension firm that currently sells drawdown products to be forced to offer a cheap, standardised version , to sit alongside other more expensive schemes that come with a broader investment choice. Keeping pensions invested in income drawdown schemes has become a highly popular way of funding retirement, and it is now more common than buying an annuity that provides a guaranteed income for life.
Now the banks cash in on wills: 1.5million families face losing billions because their loved ones were sold rip-off testaments
Up to 1.5million customers are believed to have signed up for the service in the late 1990s and early 2000s. Wills were typically offered for as little as £75, or even free. However the small print gave banks the right to appoint themselves as executor - and grab up to 2.5 per cent from an estate in legal fees. The inheritors of £500,000 of wealth risk paying out £12,500 - around six times the typical cost of £2,200.
Now you can tell banks about a loved one's death with just a click or a call: Victoria found a flaw in the system after her mum died and won a victory for all
Bereaved families can now inform all major banks of a loved one's death in a single step, thanks to a pioneering service launched today. In the years leading up to our Looking After Your Legacy campaign, we reported on several heartbreaking cases of readers' terrible experiences with banks after a loved one had died.
Seven questions to ask if you are tempted to ditch a final salary pension, to help spot red flags BEFORE you fork out for financial advice
Savers are being tempted to give up valuable final salary pensions and run the risk of investing their pots in the financial markets instead, but whether this is a sensible idea will rest on your individual circumstances. So where do you start if you are considering this crucial retirement decision? You must pay for financial advice before moving a final salary pension worth £30,000-plus, which is an important safeguard. But it's a useful exercise to find out if there any obvious red flags BEFORE before you fork out for professional advice.
Should you buy a state pension top-up? It could boost your payouts by £244 a year
Buying top-ups can get you nearer or over the threshold for getting the maximum payout, which is currently £164.35 a week - but you have to tread carefully to avoid costly mistakes it can be hard to correct. Former Pensions Minister Steve Webb, now policy director at Royal London, has just updated his firm's guide to top-ups to include help on whether it is worthwhile making the 2017/18 voluntary payment, which costs £741.
My ex-wife and I agreed to split my pension 50-50, but my old employer won't pay us because of lost paperwork - what can we do?
My ex and I have both confirmed to the administrator that we agree that my pension should be shared equally but they refuse to move without an attachment order, which the court has destroyed. If you are able and willing to suggest a solution to this impasse, we would both be truly grateful. Lawyer Teena Dhanota-Jones (pictured), of Hodge Jones & Allen, replies.
What will stop another pension disaster like Carillion? MPs declare no confidence in 'feeble' and 'chronically passive' watchdog
The pensions watchdog has come under fire as MPs issued a damning verdict on the collapse of Carillion, which has led to 27,000 of its former staff getting reduced retirement payouts. So what went wrong at Carillion, and what do MPs say should be done to prevent other firms recklessly starving their pension schemes of cash?
Government refuses to explain why this retiree lost out on nearly £4K of state pension payments over eight years
Only the persistence of Gillian Chamberlain, a retired riding school owner from Somerset (pictured on her horse Indigo), and her eagle-eyed accountant who spotted the error, eventually got her payouts corrected. The case throws doubt on the accuracy of state pension calculations, which millions of people rely on when planning their retirement finances and living on this income throughout old age.
Ex-minister Ros Altmann spearheads campaign to give all low earners same free pension cash handed to better-paid workers
Ros Altmann is leading a chorus of critics against the Government, regulators and the industry for ignoring a 'secret scandal' that deprives low earners of pension cash. Lady Altmann said she was horrified by the injustice of 'hidden' charges, and denounced those in power whom she claims have known about it for years but not bothered to sort it out. Find out why some low paid workers don't get pension tax relief, and what the Government and others say in response to Altmann's comments.
Secret scandal means low earners are losing pension cash, and no one is bothered enough to fix this injustice, says ROS ALTMANN
'The lowest earners - mostly women - are being forced to pay over the odds for their pension. Pension providers, Government officials, Ministers, industry bodies and even the Pensions Regulator are allowing this injustice to continue,' writes ex-Pensions Minister Ros Altmann, pictured. She is campaigning for low paid workers to get the same Government cash 'bonuses' received by all other savers into their pension pots.
My father died and left his money to a dog's home - I'm immensely hurt and in need, so can I fight the will?
My father has recently died leaving his estate to a dogs' home. The hurt I feel is compounded by the fact that I have a chronic illness and am unable to work. I am also unfortunately a WASPI woman, who has no state pension and therefore I am in a poor financial state. How does someone in my position try and claim? Lawyer Gary Rycroft, pictured, helps out.
Pensioners stuck in debt and parents helping their children buy homes will be offered new wave of retirement interest-only mortgages
Pensioners stuck with interest-only mortgages and those looking to help children or grandchildren on the property ladder will be offered a new wave of loans. Mortgages would help those unable to clear interest-only debts, needing mortgages to move in retirement, or even wanting to pass on an early inheritance.
Borrow till you drop! SIMON LAMBERT on the new wave of interest-only mortgages to let pensioners cash in... or help their kids
A loosening of the rules to allow interest-only mortgage lending into retirement will make it easier to tap into a home's value. On one hand it's another element of the disturbing financialisation of our homes, but who would deny someone a more enjoyable retirement, or the chance to help their children buy homes?
Just one in six families are getting the new inheritance tax perk if you leave your main property to direct descendants
The taxman took a record £5 billion in death duties in 2017-18, up £400 million on the previous year, by charging 40 per cent on estates worth more than £325,000 (£650,000 for married couples). But just one in six families who paid inheritance tax benefited from the new family home allowance, though far more were expected to qualify.
One in three retirees are giving handouts worth an average £360 a month to family members
Those who provide help are supporting on average three other members of their family at a time - usually children, but also grandchildren and their own parents. Handouts for food and travel are most common, but pensioners also often pay university fees or help others to buy homes, the research by financial giant Prudential found.
Officials admit they can't say if your state pension top-up will work and tell savers to seek expensive financial advice
We are still being contacted by readers struggling to recoup thousands of pounds in useless top-up payments. Mary O'Connor, pictured, has spent six months chasing a £3,398 refund. Savers are being told by the Government to seek expensive financial advice if they want to top up their state pensions - or risk losing thousands. Officials have told us they are unable to tell savers if the voluntary payments they make to boost their retirement income will make a difference..
Workers' pension deductions triple to 2.4% - but those sticking with auto-enrolment could see pots quadruple
The move is aimed at helping people build a bigger pot towards a comfortable retirement, but experts say the hike could feel like a 'harsh jolt' when people get their pay packets this month. On top of your own increased payment, your employer's free top-up will rise to 2 per cent of your salary, and the Government throws in a further 0.6 per cent in tax relief - bringing total contributions to 5 per cent of earnings.
Will workers stand for a tripling in pension deductions from wage packets, or rebel against auto-enrolment rises?
Millions of workers auto-enrolled into pensions will see deductions from wages triple, squeezing their spending power and testing the commitment to saving for old age. Only a relatively modest 0.8% of pay packets is being diverted into people's pensions to date, but this will jump to 2.4%, followed by a further rise to 4% in April 2019. We look at who will be affected, and the consequences of opting out or sticking with auto-enrolment pensions.
How to invest in retirement: We get the experts' tips at the Investing Show Live
In our special Investing Show Live, Simon Lambert is joined by Seven IM's Justin Urquhart Stewart and Matthew Yeates to look at why investing in retirement is different now, the investments that can suit your pension pot and the pitfalls to avoid. In the second part of the show, we look at whether the good times can return for investors after 2018's wobbly start.
My parents plan to leave their house to my daughter, but she wants to split it with me - can we do this?
My parents have decided to leave their house to their only granddaughter after their passing. However, my daughter has said it seems a little unfair on me so she wants to split the inheritance two ways, so we both get an equal share of their estate. Can this be done and are there any taxation implications? Liz Alley of Brewin Dolphin (pictured) replies.
Advisers face ban on 'no transfer, no fee' offers, to protect savers thinking of cashing in final salary pensions
Watchdogs could ban financial advisers from offering 'no transfer, no fee' deals to savers looking to ditch final salary pensions. Savers are being tempted to give up valuable defined benefit pensions, which promise a set income for life, by large sums paid into inferior pensions they must invest themselves - with offers potentially worth hundreds of thousands of pounds.
My parents are buying a retirement flat but I'm worried about fees they might face - what are they?
There has been a spate of headlines recently about some retirement property developers' hidden fees and escalating ground rents. However, not all are the same and many provide great service. We ask McCarthy & Stone's chief executive Clive Fenton to give us a detailed breakdown of the costs your parents can expect.
My brother sold my late mum's house in the Caribbean, but he won't tell us how much for and give our family any details
How can I get my brother to produce documentation that reveals how much he sold my mother's house for, where he put the money and how much, if any, is left? He was given power of attorney to sell my mother's house which was in the Caribbean. Since my mother has died he is reluctant to let us know any of the above details and is making no arrangements to split the remainder of the money, in accordance with her will. Solicitor Gary Rycroft (pictured) replies.
Pension firms must start pushing rivals' best annuity deals, just as rates finally start creeping up
Savers will have to be told the difference between a provider's own offer and the best available one - in pounds and pence annual income - from a comparison tool covering every firm in the market. Today's rule change by the Financial Conduct Authority comes into force as annuity rates finally start increasing after years at rock bottom, following recent interest rate rises.
Money Pit Stop: We are high risk investors who want to retire at 50 on £50,000 a year - can we make it?
Merchant seamen Fiona and Greig, both 35, want to retire at 50. Between them the Glasgow couple, pictured, currently have a combined pension investment pot of £240,000 plus their own mortgaged home and a buy-to-let, and hope to retire with a £50,000 joint income in just 15 years. To do that they plan to pursue their high-risk Asian investing strategy. We get a financial planner to review their plan. ...read ...read ...read ...read ...read
Divorcees retiring this year expect to be £3,800 a year worse off than married couples
Those still married said they expect to have a yearly pension income of £21,400, compared to £17,600 for those who have gone through divorce, according to a survey of 1,000 people planning to retire this year commissioned by pension provider Prudential. Research also shows that 15 per cent divorcees have no private pension savings to rely on at retirement, compared to a smaller 11 per cent of married couples.
Tax chaos for 900,000 savers as NS&I; three-year pensioner bonds come to an end and interest is paid all in one go
Up to 900,000 savers face a tax nightmare as NS&I; three-year pensioner bonds come to an end, as they will be paid interest all at once and potentially bust the interest-free limit. TDeals were sold from January 15, 2015, to May 15, 2015, and were popular for their 4 per cent interest rate on up to £10,000. But the tax quirks on this 'simple' account are complex.
Can you spot pension scams? Most can detect 'too good to be true' offers - but may miss the 'clone' menace
Research probing 2,000 adults on their vulnerability to fraudsters found that 29 per cent - the equivalent of 14.8million Britons - would miss the most common methods of looting retirement savings. The fraud test results were published by the Pensions and Lifetime Savings Association as it emerged watchdogs are battling a worsening 'cloning' scourge. This is where financial sharks create copycat websites and pose as legitimate investment businesses to cheat people out of their savings.
Fearless Frank Field reveals how he brought TWO Philip Greens down to size!
If you are an errant business leader, then the veteran MP is a figure to strike fear in your heart. Since taking over the chairmanship of the Work and Pensions Select Committee in 2015, 75-year-old Field has picked fights with some of the biggest names and companies in the country. His most famous opponent is retail tycoon Sir Philip Green (although he has also locked horns with another Philip Green, chairman of Carillion).
Saver loses £3,700 amid row over missed messages and deadlines, as old employer hangs onto pension cash
Shane Bujold, a 32-year-old accountant, has accused former employer SC Johnson of unfairly withholding a chunk of his pension fund, and blamed bungled messages by its administrator Aon Hewitt for his predicament. SC Johnson told This is Money that it had followed the rules, and Aon defended its conduct in a response published below.
Personal pensions under investigation, as watchdogs probe charges and fairness of savers' plans outside work
FCA will look at whether consumer protections need to be introduced after an investigation into whether personal pensions are too complicated, hard to swap between, or over-priced. Regulators are turning their attention to 'non-workplace' pensions after a sweeping overhaul of work schemes in recent years.
How to improve inheritance tax: Raise the tax-free sum and ditch Osborne's confusing home rules, say experts
News of an inheritance tax overhaul has led to an outpouring of helpful suggestions from experts - and top of the wishlist is ditching or revising George Osborne's new property rules. Chancellor Philip Hammond is also being warned against any sneaky new ploys to raise revenues from people passing on wealth to loved ones.
Inheritance tax put under review as Chancellor condemns overly complicated rules on passing on wealth
Officials are set to probe everything from submitting returns and paying tax, to making IHT-free gifts and estate planning - but there is no indication of whether the 40 per cent 'death tax' levy could be cut. Chancellor Philip Hammond calls the current inheritance tax regime 'particularly complex' in a letter to the Office of Tax Simplification/
SIMON LAMBERT: To make inheritance tax better we should get rid of all the fiddly reliefs and cut the rate to 20%
Whatever his real motivation, the Chancellor had a point in his call to put inheritance tax under review - it has a stupidly complicated set of rules and reliefs and is only getting worse. So, if the Chancellor really wants to simplify IHT, here is an idea: get rid of all the fiddly reliefs, keep a tax-free threshold and cut inheritance tax to a flat 20% above it.
My brother and his family live in my late mother's home, but the rest of us want to sell: How do we get our share of the estate?
Our mother passed away in 2013 leaving the estate to be divided between siblings.The time now has come where we feel that it is time to sell, but my brother still lives there. As the executor how can we make this legal without losing our individual share of the estate? Paul Handford, lawyer at Which! Legal (pictured), explains the options.
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FUND AND TRUST IDEAS
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HOW TO RETIRE IN RICHES
How to invest your pension and live off it in retirement: A 12-step starters' guide - and the pitfalls to avoid
While many people dislike the idea of an annuity, the alternative means keeping your pension invested in retirement and managing it yourself - a process that can be confusing and full of pitfalls. So here's a checklist, from investing, to income, taxes, the state pension, inheritance, illness, financial advice and much else.
Beat the annuity traps that could rob you of thousands: Lock down your retirement income with our brilliant guide
By the time you retire you should really have mapped out how you'll get an income that'll last as long as you'll need. Ideally, that means sitting down with a financial adviser and plotting a course for your investments before you stop work. But there is nothing stopping those who've already started dipping into their pot from coming up with a masterplan now.
How to invest in retirement: What you should do to get the best income and keep your pension pot intact
Elderly investors have to balance the need to make withdrawals yet keep a pot as intact as possible - whether to avoid running out of money or bequeath a pension to loved ones. We take a look at how much you need to change investing strategy in retirement, and round up some expert tips on keeping on top of your portfolio and cutting your tax bill.
Spend your pension pot last! We reveal the order to use savings in retirement to defend your cash from the taxman
Hoard your pension and spend other cash and investments first, to keep your money away from the taxman. That's the advice experts are dishing out to retirees worried about inheritance tax. But anyone who wants to minimise their annual income tax, or use up their capital gains tax allowance efficiently, might also benefit from not spending a pension first.
10 ways to avoid inheritance tax: How to stop the taxman grabbing some of your estate from your loved ones
There are many legal ways to dodge the dreaded 40 per cent 'death tax' if you want to pass on the maximum sum possible and are prepared to plan ahead. Here's our round-up of 10 ways to reduce or avoid a large inheritance tax bill, some of which can be undertaken easily by any ordinary person without the need for elaborate arrangements or to pay for professional help.
New state pension age: As we're all told to work longer, when will you be able to retire?
A fresh state pension rise is now due to happen between 2037 and 2039, after the Government accepted the recommendation of ex-Confederation of British Industry boss John Cridland, who carried out an official review of future state pension age increases. We explain forthcoming changes to the state pension age, so you can find out when you will be allowed to retire. ...read ...read ...read ...read ...read ...read ...read
Why more families are going to court over inheritance: But our free guide can help avoid costly rows
Modern family dynamics are also causing more rows, with divorce, second marriages, stepchildren and half-brothers and sisters now common. The more extended the family, the more likely it is that arguments will arise. One of the most recent high-profile cases is a dispute over the legacy left by Lynda Bellingham, who starred in the Oxo adverts in the Eighties.
Are you ready to embrace income drawdown after pension freedom? Here's how it works and what schemes are available
Instead of being stuck with stingy annuities, retirees now have the freedom to dip into their pensions using income drawdown. These schemes allow you to take sums out of your pension pot while the rest stays invested. So what are the advantages and risks of doing this, and what schemes are on offer? We run through the main options now, and look ahead to what might become available in future.
Making the most of your pension savings: What should you do with a retirement pot of £30k, £50k, £100k or £150k-plus?
Pension freedom reforms will give people more decision-making power over their retirement savings from next year. The options to access your money, spend or invest it will widen - although your choices will still largely depend on the size of your pension pot. Financial experts Mark Stone of Whitechurch Securities and Ben Westaway of Jessop Financial Planning explain both your opportunities and the limitations on them.
Looking to make a will? Make sure you're not taken for a ride by cowboy will writers
Are you at risk of leaving your family with nothing but legal bills because of a badly written will? Find out what your options are and how to guard yourself against an invalid will.
ASK A PENSIONS EXPERT
My daughter will give her son £100k to buy a house, but can we protect it in case he marries and dies and his widow inherits?
My daughter is gifting her son £100,000 to help him buy a house. We are concerned that, if he marries and then dies, 'her' money in the form of the house may disappear to a third party, her son's widow. Which is the best way to safeguard the money? Lawyer James Antoniou, pictured, of Co-op Legal Services, replies.
My wife wants to keep our house while I get my pension in divorce, but I need somewhere to live - what should I do?
My wife and I are soon to have a 'clean break' divorce. Her lawyer wants me to sign over the house to the ex, that I have paid for all my working life in exchange for not touching my pension. My pension will not help me get a property until I retire as I would be too old to get a mortgage. Lawyer Caroline Elliott, pictured, replies.
I didn't seek a financial settlement on divorce because my ex-husband was threatening my life - can I get one now?
I need to claim from my ex-husband's private pension. I am 64. I have been divorced since 1992 with no child support or divorce settlement due to domestic violence. He threatened my life. I had an injunction with the power of arrest until I was divorced. Lawyer Jo Edwards, pictured, replies.
Can my abusive dad go after my hardworking mum's pension if she divorces him?
My mum and dad are separated and living apart now for years. Dad was emotionally abusive and unfaithful to mum for years. She now wants rid of him from her life - through divorce. But she is retired and lives off her pension, plus her state pension. Can my dad potentially make a bid for mum's pension if she were to divorce him? Jacqueline Major (pictured), solicitor and Partner at London law firm Hodge Jones & Allen, replies.
I want my late grandfather's war diaries, but my aunt refuses - can I make her hand them over because my mother is the eldest sibling?
On a recent trip to South Africa my mother requested that my aunt give me my grandfather's war diaries. She refused. As far as I know these were not specified in any will. Is she entitled to them because she has power of attorney for my grandmother? Can I make her hand them over because my mother is the oldest and so she should have claim to them?
My father died and now my stepmother plans to leave everything to her two children, can I do anything?
My father passed away in 2010. His second wife is 85 and still living in the house they bought. My father's half was left to myself and two sisters, possibly grandchildren. Now my father has passed away my stepmother is saying we will not get anything and everything will go to her two adult children. Is there anything we can do?
My mum has moved to a care home - can dad leave his share of their house to us children instead?
My mother has recently moved out of her home where she lived with my father, which they jointly own, into a dementia care home permanently. My father still lives in the house. Their wills are arranged so that the house goes to the surviving partner when one of them dies and then is shared between the children when the remaining partner passes. As my mother will never be able to return home dad wants to change his will so that his half of the house goes directly to the children. ...read ...read ...read ...read ...read ...read ...read
If I die and my husband remarries, how do I make sure my four kids inherit my money not their future stepmother?
I want to ensure that if I die before my husband he gets the money, but if he remarried and then died my half would end up with my children not any new spouse or her children. How can I safeguard so that any new wife would not reap the rewards of what we have built up and at some point my children will get something from my estate?
Can I dispute the will of a deceased relative? One family member persuaded her to rewrite her will in his wife's favour, kept her death a secret, held a shotgun funeral and cleared out her house before anyone else had been informed...
He suddenly kept turning up on my relative's doorstep prior to her death after ignoring her for years, redid her will to leave all assets to his own wife and appointed himself executor. By the time family members had been informed of the death, he and his wife had the house cleared out and all family items sent to an auction, and had a fast funeral with no announcement or attendees apart from him and his kids. We have no idea how much the assets were worth but there were valuable paintings, antiques and at least £50,000 in cash. Is this legal and what action can be taken?
Premium Bonds winners
Prize value | Winning bond No. | Area |
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£1,000,000 | 305QA758516 | Suffolk |
£1,000,000 | 166LV246433 | South West Wales |
£100,000 | 310DE079563 | Oxfordshire |
£100,000 | 301QE388998 | Hampshire and Isle of Wight |
£100,000 | 292AX214827 | Staffordshire |
£100,000 | 285DM417799 | Hampshire and Isle of Wight |
£100,000 | 252MQ398367 | East Sussex |
£50,000 | 318BE824298 | Essex |
£50,000 | 298DM771811 | Hampshire and Isle of Wight |
£50,000 | 288EE395340 | Kent |
£50,000 | 280RV582133 | North Yorkshire |
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