'Scrap pension tax relief altogether' - Hargreaves Lansdown

Proposals will motivate the young - Tom McPhail

Tom Ellis
clock • 2 min read

Hargreaves Lansdown has called for sweeping changes to the structure of the pension system ahead of next month's Autumn Statement, proposing the government scraps pension tax relief and replaces it with a bonus system to help motivate young savers.

With a view to dropping the current system, the firm has proposed a ‘100 minus age' system where the government provides a percentage bonus on top of pension contributions equal to 100 minus the age of the contributor.  As an example, a 25-year-old would receive a 75% top-up on their contributions while a 50-year-old would receive a 50% bonus. "We particularly like the fact there's a motivational dimension to it," Hargreaves Lansdown head of retirement policy Tom McPhail said. "There's a very clear motivational message to get on and do it now. It will still be a good deal next year, but ...

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 Pensions

Sipps: How clients can avoid common retirement planning mistakes

Sipps: How clients can avoid common retirement planning mistakes

'Retirement planning stands as a cornerstone of long-term financial well-being'

James Floyd
clock 28 April 2025 • 4 min read
Origo completes pensions dashboard connection

Origo completes pensions dashboard connection

Completed connection ahead of this week’s first deadline

Holly Roach
clock 28 April 2025 • 2 min read
HMRC repays £44m in overpaid pensions tax during Q1 2025

HMRC repays £44m in overpaid pensions tax during Q1 2025

More than £1.4bn in overpaid pensions tax recouped since 2015

Martin Richmond
clock 28 April 2025 • 3 min read