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Selective blindness on rate relief

Politicians who call for the axing of higher-rate relief on pension contributions always fail to see the elephant in the room (July 13 article in Money Marketing.

The best-pensioned sector of the population is that which enjoys the defined benefits of good employer-subsidised DB schemes. The massive contributions and top-up subsidies that are paid into these schemes by private sector employers and state sector organisations completely bypass the income tax and National Insurance collection systems.

Because of this bypassing, these benefits would be unaffected by any axing of higher-rate relief on contributions. It would be unfair to cut back on tax relief for those employees (and the self-employed) who have to make full, unaided pension provision from their own resources while leaving untouched the massive reliefs enjoyed by others.

Top politicians and top civil servants are among those that benefit from these tax-free and NI-free funding arrangements for defined-benefit schemes. This great benefit that they would continue to enjoy might explain their selective blindness when they speak of axing higher-rate relief.

Paul Dare
London SW13


Origo axes personal liability in contracts

Origo has removed the per-sonal liability that each adv-iser bears under its Unipass digital certificate contracts following user concerns. Origo managing director Paul Pettitt says the move was made after feedback from users, notably Sesame, unhappy about a clause in the contract suggesting personal adviser liabilities of up to 15,000. Pettitt says Origo has been […]

Straight from HMRC’s mouth

Debate on the new trust alignment rules has been pretty much constant (among interested parties, of course) since the Budget day announcement. Much of the debate has been on the application of the discretionary trust regime to structures, particularly flexible and interest in possession trusts, that were taxed very differently before these new provisions were introduced.


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