Budget proposes replacing pension relief taper with £45k allowance

Good to see the new Government are prepared to listen to the pensions industry and consider more workable solutions than the spiteful and ill-thought out political showboating that caused Labour to introduce tapering contributions to punish those earning over £130,000 pa.

If £30,000 - £45,000 can raise the same level of tax it is a far better model and more in keeping with the word 'Simplification'.

"Having listened to the concerns of the pensions industry and employers." When are politicians going to listen to the public. The majority of the people they are meant to represent.

As always the tories can not bring themselves to deprive the wealthy of their tax breaks. The already wealthy do not need any incentives to make provision for old age.

The poor and middle income people do.

Only 268,000 in the UK earn in excess of £150,000, so what's likely to be achieved in terms of additional tax revenues by messing about with tax relief on pension contributions from high earners who, in any event, contribute most to the national exchequer in terms of income tax and NIC already?

What really needs to be done is to scrap the shackle of annuity rates and allow unspent funds on death to pass tax free into PP's for the next generation.

"The poor and middle income people do. "

And their ability to contribute to their retirement is unchanged

"What really needs to be done is to scrap the shackle of annuity rates "

announced this is being looked at

You could of course just set up a pension scheme eligible for higher rate relief with no tax free cash in retirement. It would then be what it was always meant to be a method of defering income until retirement when it is most needed

Another possible way of achieving the aim of getting more people to save for their retirement would be to have an annual cap, except the year prior to crystallisation, with say 25% tax relief across the board. This may be a level that higher rate tax payers don't baulk at too much but would encourage basic rate tax payers to save more. Not sure where that leaves the treasury tax take.

This could be good news, as always the devil is in the detail, but it really does seem that at very long last the powers that be are slowly beginning to listen. All we need to do as an industry is to understand where the Government is coming from and then provide workable, simple, low cost ways to deliver their objectives, without the complexities of pages of legalese.

This has got to be a welcome development. It reintroduces simplification to the agenda. We have to make it easy for people to understand pensions otherwise they switch off and we end up with the mess we are currently in.

Although tthis change is bound to be some issues for defined benefit schemes will these not be predominately in the publice sector which is to be reformed in any event.. Does it in fact suggest that defined contribution will be the preferred route for this.

Next target on the list has to death benefits after age 75. Perhaps the way to solve this problem is to actively encourage clients to leave their fund to charity. The consequential potential fall in the tax take would soon make the politicians take notice.