💷 Treasury officials are drawing up plans for a pensions tax raid to help pay for the UK's pandemic spending, including reducing the lifetime allowance.
❓ How will it affect you and how can you beat it?
Here's what you need to know (a #thread 👇) telegraph.co.uk/pensions-retir…
❓ How will it affect you and how can you beat it?
Here's what you need to know (a #thread 👇) telegraph.co.uk/pensions-retir…
1️⃣ A raid on pensions tax relief
Tax relief is paid at a person's marginal rate of income tax as an incentive to save money, but Rishi Sunak is considering limiting tax relief on pensions contributions to 30%…
Tax relief is paid at a person's marginal rate of income tax as an incentive to save money, but Rishi Sunak is considering limiting tax relief on pensions contributions to 30%…
💼 This would affect nearly 5m workers who pay 40% or 45% income tax.
Under a 30% flat rate, a 35-year-old earning £60,000 paying 4% of their salary into a pension could be £50,440 worse off by retirement age telegraph.co.uk/pensions-retir…
Under a 30% flat rate, a 35-year-old earning £60,000 paying 4% of their salary into a pension could be £50,440 worse off by retirement age telegraph.co.uk/pensions-retir…
2️⃣ Slashing the lifetime allowance
The Treasury is also mulling cutting to the pensions lifetime allowance from £1,073,100 to as low as £800,000.
The allowance places a limit on how much savers can put into pension pots tax free…
The Treasury is also mulling cutting to the pensions lifetime allowance from £1,073,100 to as low as £800,000.
The allowance places a limit on how much savers can put into pension pots tax free…
💰 Millions will be forced to pay thousands more in taxes if the changes came into force.
Anyone with £1m in their pension pot would pay £110,000 to the taxman if they were charged 55% and withdrew the £200,000 above the allowance as a lump sum telegraph.co.uk/pensions-retir…
Anyone with £1m in their pension pot would pay £110,000 to the taxman if they were charged 55% and withdrew the £200,000 above the allowance as a lump sum telegraph.co.uk/pensions-retir…
3️⃣ Taxing employer contributions
A new charge on "employer contributions" would deliver a blow to workers overnight.
10m+ people could lose out on tens of thousands of pounds that would otherwise be paid into their pensions by their employer…
A new charge on "employer contributions" would deliver a blow to workers overnight.
10m+ people could lose out on tens of thousands of pounds that would otherwise be paid into their pensions by their employer…
🏢 Adding a charge would also discourage firms from raising the amount they contribute and would create a dent in the amount of money that goes into pensions every month telegraph.co.uk/pensions-retir…
❓ So how can you beat it?
There are ways savers can shield their money from the worst of the tax rises.
@Jessica__Beard offers some clever tricks to protect your nest egg here: telegraph.co.uk/pensions-retir…
There are ways savers can shield their money from the worst of the tax rises.
@Jessica__Beard offers some clever tricks to protect your nest egg here: telegraph.co.uk/pensions-retir…
❓ What else do you need to know?
Read @benrileysmith's report 👉 telegraph.co.uk/politics/2021/…
Read @MoneyTelegraph's guide to how the Government's pensions tax raid affects you 👉 telegraph.co.uk/pensions-retir…
Read @benrileysmith's report 👉 telegraph.co.uk/politics/2021/…
Read @MoneyTelegraph's guide to how the Government's pensions tax raid affects you 👉 telegraph.co.uk/pensions-retir…
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