Annual limit reduced to £50k; Lifetime allowance cut to £1.5m

Jonathan Stapleton
clock

The annual allowance for tax privileged pensions will be cut from £255,000 to £50,000 from April next year, the Treasury announced this morning.

Financial secretary to the Treasury, Mark Hoban, also said the lifetime allowance would be reduced from £1.8m to £1.5m from April 2012. The government estimates an annual allowance of £50,000 will affect 100,000 pension savers - 80% of those will have incomes over £100,000. Any unused annual allowance in one tax year can be carried forward to the following three tax years. To protect individuals who exceed the annual allowance due to one-off "spike" in accrual, the Government will allow individuals to offset this against unused allowance from previous years. Tax relief will be g...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Advisers turn to smoothed funds to help manage volatility threat

Advisers turn to smoothed funds to help manage volatility threat

Decreasing exposure to equities also a popular strategy

Isabel Baxter
clock 26 March 2024 • 1 min read
Examining the 60/40: Building diversified portfolios in 2023

Examining the 60/40: Building diversified portfolios in 2023

Advisers have a lot to consider when it comes to portfolio diversification

Charlotte Moore
clock 14 April 2023 • 6 min read
Schroder Investment Solutions expands distribution of MPS

Schroder Investment Solutions expands distribution of MPS

Expanding the range of DFM choice on the Parmenion platform

Ayesha Venkataraman
clock 06 December 2022 • 2 min read