2880/3600 contribution threshold - review?

stoozie1
stoozie1 Posts: 656 Forumite
in Pensions, annuities & retirement planning
Hi,

As this threshold for low earners seems to have been the same since at least 2012, I wondered if anyone had seen any reports on when this may be due a review.
Save 12 k in 2018 challenge member #79
Target 2018: 24k Jan 2018- £560 April £2670

Comments

  • badmemory
    badmemory Posts: 7,788 Forumite
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    As this implies tax being refunded that has never been paid I would think that any review would be downwards. We have a conservative government, their mindset is to tax the poor not the rich, therefore a tax benefit to a non-earner (ie poor) who hasn't even paid the tax in the first place would be a good target. They just haven't spotted it yet!
  • Alexland
    Alexland Posts: 9,653 Forumite
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    badmemory wrote: »
    As this implies tax being refunded that has never been paid I would think that any review would be downwards. We have a conservative government, their mindset is to tax the poor not the rich, therefore a tax benefit to a non-earner (ie poor) who hasn't even paid the tax in the first place would be a good target. They just haven't spotted it yet!

    I would expect there to be good uptake of this perk amongst the wealthy where they have partners and children that don't earn an income but would benefit from a pension.

    Alex
  • zagfles
    zagfles Posts: 20,323 Forumite
    First Anniversary Name Dropper First Post Chutzpah Haggler
    edited 18 March 2018 at 9:59AM
    badmemory wrote: »
    As this implies tax being refunded that has never been paid I would think that any review would be downwards. We have a conservative government, their mindset is to tax the poor not the rich, therefore a tax benefit to a non-earner (ie poor) who hasn't even paid the tax in the first place would be a good target. They just haven't spotted it yet!
    Yeah, they really are that stupid "not to have spotted it yet". They probably haven't spotted that the massive cut in the annual allowance for those on £150k+ and the lowering of the LTA just affects their "rich mates" or that the big rises in personal allowances proportionally helps those on NMW more. They must be really thick. Because we all they're out to screw the poor, the Mirror tells us every day.
  • dunstonh
    dunstonh Posts: 116,369 Forumite
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    As this threshold for low earners seems to have been the same since at least 2012, I wondered if anyone had seen any reports on when this may be due a review.

    You mean 2001. Not 2012.

    Its difficult to say but in 2015, the Govt said it would look to change the non-earners limit if it was being abused under the pension freedoms. However, as the £3600 limit has existed for 17 years now unchanged, its unlikely to fall but there isnt really any incentive or reason why it would need to be increased.

    Not may non-earners pre-retirement, can afford to pay £300pm into a pension.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • stoozie1
    stoozie1 Posts: 656 Forumite
    In terms of a reason, I was thinking of parity with the ways that allowances which affect the wealthier are adjusted to allow for inflation, such as the LTA.
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- £560 April £2670
  • dunstonh
    dunstonh Posts: 116,369 Forumite
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    stoozie1 wrote: »
    In terms of a reason, I was thinking of parity with the ways that allowances which affect the wealthier are adjusted to allow for inflation, such as the LTA.

    You mean how the limit was £1.8 million in 2011/12 and is now £1 million? ;)
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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