Boris Johnson will create pension tax relief 'losers' with mooted income tax reforms

£80,000 threshold

clock • 1 min read

Boris Johnson's mooted income tax reforms would create a double-edged sword whereby income tax winners would become pension tax relief losers, according to research by Aegon.

Prior to his appointment as prime minister, Johnson proposed increasing the higher-rate tax threshold from £50,000 to £80,000, meaning those earning within this wage would be ‘winners' by not paying as much income tax. However, Aegon revealed pension savers earning within this range would also lose their higher-rate pension tax relief, leaving them receiving basic rate relief instead. The firm noted that, if savers decided to reduce their pension contributions in order to keep tax charges unchanged, they could then face a 25% comparative drop in the value of their pension pot when the...

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

Pension IHT: A minor win for executors, a missed opportunity for HMRC

Pension IHT: A minor win for executors, a missed opportunity for HMRC

'It's a great pity HMRC couldn't have been a bit braver and taken the sensible approach'

Rachel Vahey
clock 09 December 2025 • 3 min read
Salary sacrifice change to 'hit' more than three million workers

Salary sacrifice change to 'hit' more than three million workers

Government releases impact assessment

Jen Frost
clock 05 December 2025 • 3 min read
Andrew Tully: Plummeting pensions confidence is 'siren call' for wide-reaching action

Andrew Tully: Plummeting pensions confidence is 'siren call' for wide-reaching action

'We're seeing a deep erosion of trust in the retirement system'

Andrew Tully
clock 05 December 2025 • 3 min read