Tax on investments
Pensions benefit from many tax advantages that can help you to build your pension pot faster.
Tax-efficient investment in pension schemes
The contributions that you and/or your employer or someone else pay into your pension scheme are invested and benefit from a number of tax advantages. As explained, you receive income tax relief on contributions that you pay.
Once contributions to your pension scheme are invested, they grow largely free of taxes until you decide to draw your retirement benefits.
The tax treatment of pension funds means that they should grow faster than equivalent taxable funds. Although your contributions benefit from tax relief and your pension pot grows largely free of taxes, tax may be payable on retirement benefits that you withdraw.
Where can I find out more?
If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.