Concerns have been growing that the Budget proposal to restrict tax relief on pensions for people earning more than £150,000 may be the thin end of the wedge and the Government may lower the threshold further in future.
At the Marketforce flexible retirement solutions conference in London on Tuesday, Lord McKenzie refused to quash these fears and added that the Budget pension tax relief move was a long way short of what could have been announced. He said: “I cannot give that assurance. There is a measure of reassurance in the fact that higher-rate tax relief has been around for a long time but you know the restriction of £150,000 is pretty much the top end of what might have been done in this Budget. That said, this is a time where the search for increased revenue is very pressing indeed.”
He added that the matter was for the Treasury to consider.
The Treasury select committee last week called on the Government to review the impact that the restriction will have on pension savings and to consider alternatives, such as reducing the annual contribution allowance.