Aifa director general Chris Cummings says this will further damage the pensions saving culture in the UK.
He says: “We need people to take more responsibility for their retirement plans and Government action should encourage more people to save, not punish those who are taking the right course of action.
“The decision to immediately limit additional pension contributions from higher earners risks jeopardising the sensible savings plans of wealth creators. This will impact on the self employed, entrepreneurs, and company directors who typically make irregular annual lump sum pension contributions. Although this is restricted to a small group of people it is a worrying and complicated step from the Government.”
Cummings says Aifa welcomes the steps to help small businesses, in particular the extention of the scheme allowing loss-making small businesses to reclaim taxes on profits from previous years.
But Cummings adds: “It is a shame that while the Government is committed to helping small firms the regulator, the Financial Services Authority proposes significantly increasing its fees for IFA firms.
“We note the Government’s plans to address the future of financial markets and that it will publish a paper before the summer that will cover regulatory approaches. Given the systemic importance of IFAs, and the fact that more consumers than ever before are seeking financial advice, we look forward to working with the Government on these plans.”