Pension Tax Relief High Earner

Anti-forestalling Measures & Special Annual Allowance Tax Charge

On 6 April 2011 - Pension tax relief will be reduced for high earners to just 20%.  

Anti-forestalling Rules
These were created in 2009 to prevent high earners bringing forward pension contributions and paying excessively larger pension contributions today before the new rules start to get 50% or 40% tax relief today and not 20% tomorrow.

Special Annual Allowance - £20,000 - the limit at which high earners can pay individual pension contributions without tax penalty and gain maximum tax relief. 

Special Annual Allowance Tax Charge - Payments above the £20,000 limit will attract a tax charge, i.e.  a reduction in tax relief to just 20%.  See £130K + Tax Rules and £150K + Tax Rules (unless you have a protection contribution allowance).

Protected Pension Contributions - £30,000higher individual pension contribution limit without penalty for those who can prove that they were paying in more than £20,000 before new rules announced.