Tax relief

In light of last week's Budget announcements, Peter Ng, IFA at Retirement Solutions, reviews what the changes to pensions tax relief will mean to those retiring.

Well, it's that time of year again as we all wait for the fall-out from the forthcoming Budget.

The Office for Tax Simplification (OTS) has made interim suggestions on simplifying tax for pensioners - and IFAs have many more of their own.

Shadow Chancellor Ed Balls has called for the government to cut pensions tax relief to 26% for people earning more than £150,000 per year.

The government is planning an overhaul of the way it grants tax relief on pensions which will cost the pension industry, employers and the government "hundreds of millions", an expert has warned.

British taxpayers have wasted £88.6bn in tax relief over the last decade, and will waste a further £12.6bn in 2012 alone, a new report suggests.

The potential reform of pensions tax relief could provide several opportunities for advice.

Deputy prime minister Nick Clegg and Treasury secretary Danny Alexander will meet with David Cameron and George Osborne today to demand more tax on high earners' pensions.

Retirement Planner's round-up of the top pension stories this week.

People paying 50% tax must claim extra tax relief on their pensions before February or risk losing thousands for good, a private bank estimates.