Savers warned: Another pension tax raid looms as Reeves prepares to replicate Canada plan

Reeves confirmed she was planning sweeping reform of Britain's pension system after having touted the idea in August.

The Chancellor dragged private pensions into the inheritance tax net in the latest Budget, although pensioners remained largely unscathed from any other changes.

However now there are concerns there could be more on the cards as Reeves seeks to replicate the Canadian retirement model.

Ros Altmann, a former pensions minister under David Cameron, told the Telegraph it was a "nailed-on certainty" that Rachel Reeves would tax pensioners further.

She said: "Unquestionably, they’re bound to – it’s where the big money is.

"I hope it won’t happen without some kind of major review that would look at things in the round and take careful soundings and advice, rather than instant announcements [in the Budget].

She added: "Inheritance tax [on pensions] is a classic case of sounding great for someone who wants money coming in, but has all kinds of unintended consequences. The new system will mean retirees will try to spend money as quickly as they can.

"There are still so many different ways to tax pensioners – by cutting the cost, and by raising revenue on money already there."

Helen Miller, Deputy Director of the IFS speaking on the Chancellor's budget changes said: "There is room for criticism. Its not going to be easier next budget, they are going to be closer to next election and its still politically difficult to do some of these things.

"I hope they do a better job next time. I would have liked a government coming in for the first time in 14 years with a bit of a plan."

Ben Zaranko, senior research economist at the IFS added: "The strategy is what can they get away with rather than what can they do."

In August , the Chancellor called on pension funds to “learn lessons from the Canadian model and fire up the UK economy”.

The Chancellor hosted a roundtable with the so-called ‘Maple 8’ group of Canadian retirement funds in Toronto.

She urged the funds to continue backing Britain and take home lessons about how consolidation of pension schemes into larger funds can help drive investment in productive assets such as vital infrastructure and high-growth businesses.

The Canadian Pension system

1. Old Age Security (OAS)

Eligibility: All Canadian citizens and legal residents aged 65 and over are eligible for OAS, provided they have lived in Canada for at least 10 years after turning 18.

Funding: OAS is funded through general tax revenues, meaning it’s not contribution-based.

Benefit Amount: The amount varies based on years of residency in Canada. Those with at least 40 years of residency since the age of 18 receive the maximum benefit, though partial benefits are available with as little as 10 years of residency.

Clawback Provision: For higher-income individuals, some or all OAS benefits may be "clawed back" (reduced) through the OAS Recovery Tax if their income exceeds a certain threshold.

2. Canada Pension Plan (CPP) / Quebec Pension Plan (QPP)

Eligibility: This is a contributory, earnings-based plan available to all working Canadians outside Quebec (Quebec has a parallel program, the QPP).Funding: CPP is funded by contributions from both employees and employers, with self-employed individuals paying both portions.

Benefit Amount: CPP benefits depend on an individual’s earnings and the number of years they contributed. The standard age to begin receiving CPP is 65, though you can opt to start as early as 60 (with reduced benefits) or delay until 70 (with increased benefits).

Other CPP Benefits: CPP also offers disability benefits, survivor benefits, and children's benefits for dependents if a contributor passes away.