28 July 2010
Her Majesty's Treasury has published a consultation document on
the restriction of pensions tax relief. As announced in the June
Budget the government will continue with plans to raise revenue by
restricting pensions tax relief.
Recently many concerns have been raised by the pensions industry
and employers about the complicated approach adopted in the Finance
Act 2010 by the outgoing government.
A Treasury statement said: "Having listened to the concerns of
the pensions industry and employers, the Government has
reservations about the approach adopted in Finance Act 2010
(April). It believes this could have unwelcome consequences for
pension saving, bring significant complexity to the tax system, and
damage UK business and competitiveness. As such, the Government is
considering an alternative approach involving the reform of
existing allowances, including a significantly reduced annual
allowance."
The initial proposal is to introduce a cap on the amount of
relievable pension contributions that can be paid in the region of
£30,000 to £45,000 per annum. The Treasury is currently
seeking submissions from employers, pension schemes and other
interested parties. The closing date for submissions is 27 August
2010.
The full Treasury statement plus other published documents on
this subject can be found here:
http://www.hm-treasury.gov.uk/consult_pensionsrelief.htm
