Prior to the election the Conservative Party announced that they intend to restrict tax relief for those earning more than £150,000. At present we only have an outline of how this will work but, on the face of it, could result in a loss of Income Tax relief for high-earning clients.
The effectiveness of pensions as a savings vehicle for anyone earning more than £150,000 would clearly be strikingly reduced and, while the timetable for implementing changes is not yet known, this could be announced as early as the forthcoming 8 July Budget.
Certain clients may wish to consider a pension contribution prior to this date as, while there can be no guarantee, it would be surprising if any reduction to the Annual Allowance was applied retrospectively to contributions already made.
See our summary highlighting the key issues and an outline of potential planning.
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This article was previously published on Tilney prior to the launch of Evelyn Partners.