Pension charge for high earning individuals

Fri, 24 Apr 2009

The second budget issued this week by Alistair Darling affects people with pension schemes who earn over £150,000 per annum.

According to pensions news, high earners in this bracket will have to pay tax on the contributions made by their employers into their pension schemes . Furthermore, a reduction in tax relief on pension contributions by the scheme holder will also be initiated.

An associate at Sacker and Partners, Eleanor Daplyn, was reported in the pensions news as commenting: "The government has said it will be consulting on how the changes will apply to pension savings made by employers on behalf of their employees, but this feels a bit like shuffling deckchairs on the Titanic. Legally, the proposals can only lead to further complication and expense for trustees and employers alike at a time when the pensions industry faces more than enough challenges already."
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