The Government has now announced its proposals for amending the tax reliefs available on contributions to registered pension schemes. It has also indicated that it will reduce the maximum amount of pension funding that can be accumulated without incurring a tax charge at the time that benefits come into payment.
Key features of the changes are that:-
- The maximum tax relieved pension contributions will be £50,000.
- There will be a new carry forward regime from 2011/12 for contributions.
- The limit on tax relieved pension savings, measured when benefits are payable, will drop from £1.8 million to £1.5 million.
- Existing enhanced or primary protections will continue.
- Certain types of non-registered pension arrangements including some EFRBS will lose their tax advantages.