Government Rejects Pension Tax Relief Changes Again
Published / Last Updated on 10/06/2021
The Treasury Select Committee issued its report to the Government in March 2021 called “Tax After Coronavirus”. As part of the report, it included proposals for changes to pension tax relief.
Historically, changes to pensions tax relief have been on the agenda for 6 years now. It goes way back to when George Osborne was Chancellor and changes were postponed due to the Brexit referendum result.
- 2015 – Consultation paper but government suggests no clear consensus on tax changes to pensions.
- 2020 – Yet another report and the government again said no to a full scale review (we were in the middle of covid-19 lockdown)
- 2021 – Latest Treasury Committee paper which again the government suggesting there is still no clear consensus on tax changes to pensions but it added that it was trying to rebalance the burden of taxation on pensions with higher earners having tapered annual allowances, tapered excess annual allowance tax charges and lifetime allowance excess tax charges by freezing allowances so that lower earners pay less tax but higher earners pay more thereby given a fairer distribution o
We suggest given Brexit and then the Covid-19 pandemic, the British Government wants a period of stability to rebuild the economy and indeed a greener economy post covid-19.
Pension tax relief changes will not happen just yet but make no mistake, they are definitely on the agenda.