Pension Tax Relief - Take it while it lasts.

Posted on 25 February 2011 by Douglas Chadwick

Pension Tax Relief - Take it while it lasts. The budget introduced some significant changes to the tax relief available on pension contributions. It is important that investors do not miss out. When you consider the current levels of government borrowing, estimated to be £528 billion over the next five years, it could be argued that the government needs to take more drastic action and further reduce higher rate tax relief available on pension contributions. Higher rate taxpayers should consider urgently their pension contributions and the opportunities available to them. Currently, the government estimates an increase in revenue of just £3.1 billion by restricting the higher rate tax relief on pension contributions for people with income of more than £130,000. This represents only 11% of the total tax relief given to pension contributions. The current change to tax relief on pensions will affect around 291,000 people. However, there are a further 3.3 million people who are higher rate tax payers but who earn less than £130,000 and these could be caught if further restrictions were introduced. Read more from the SaltyBlog in the Newsletter...