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Govt to examine pensions tax relief fairness

Magnifying-Glass-And-Text-Kindle-Contract-700x450.jpgThe government has said it will “examine the process for payment of pensions tax relief” in response to concerns low-paid workers in net pay schemes are losing out.

Addressing the House of Lords on Monday night, parliamentary under secretary of state for pensions Baroness Buscombe said the government wants to make the most of any new opportunities that emerge to make tax relief work better.

She added it is important that employers are free to choose a scheme that best suits the needs of their businesses and workers.

Reacting to the statement, AJ Bell senior analyst Tom Selby says: “Denying the lowest earning savers the tax relief they are due is clearly wrong and the government is right to consider solutions to deal with this specific problem.

Think tank moots flat-rate pension tax relief

“By raising the issue of pension tax relief reform, however, Baroness Buscombe will inevitably inflame concerns more radical changes could be pursued. Given the £20bn funding promise to the NHS made by the prime minister early this month, many now fear retirement savings incentives will be caught in the crossfire.”

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There are 2 comments at the moment, we would love to hear your opinion too.

  1. Julian Stevens 27th June 2018 at 9:44 am

    Says Baroness Buscombe: It is important that employers are free to choose a scheme that best suits the needs of their businesses and workers. Err, excuse me, but don’t the government’s imposed parameters for AE schemes go directly against the very idea of employers being free to choose a scheme that best suits the needs of their businesses and workers?

    • Absolutely correct Julian. Businesses and workers are dragooned into 3rd class schemes with dubious investment prospects at the mercy of the vagaries of the markets.

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