The impact of the tapered annual allowance is clear after a 27 percentage point increase in NHS staff who exceed the pension annual allowance electing voluntary scheme pays, Quilter has said.
The wealth manager found 38% of NHS staff who breached the allowance in 2018/19 elected for the scheme pays option, up from 11% in 2015/16. The option allows savers to settle annual allowance tax charges through their pension scheme, negating the need to present upfront cash. While threshold levels under tapered annual allowance changed at the start of this tax year, Quilter said the "legacy of annual allowance issues for many doctors" continue. Charges for breaching the tapered annual allowance saw many doctors reject promotions or offers to work extra hours, even during the Covid-19...
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