Pension tax relief

foofi22

I've had a recent pay rise that has met I can 'benefit' from the relief.  Therefore there is a high probability it will be removed, sorry for ruining it for everyone

MK62

EdSwippet said:

MK62 said:

kinger101 said:

Broadly - I think 6.25% benefit is insufficient to encourage saving within an pension.

......but what would HR taxpayers do with the money they then no longer save into a pension?

Venture Capital Trusts (VCTs)?

Yes, that's an option....if the risks are palatable of course.......and providing the 30% tax relief isn't reduced as part of any tax relief cost saving measures.......and I suspect it would be if VCT (and similar) investing ramped up several orders of magnitude as a result of any changes to pension tax relief........but it's all speculation.......in all likelihood Mr Sunak and Mr Hunt will kick this can down the road again.

Mick70

MK62 said:

kinger101 said:

Broadly - I think 6.25% benefit is insufficient to encourage saving within an pension.

......but what would HR taxpayers do with the money they then no longer save into a pension?

Lot of my colleagues are now investing in holiday lets and seem to be plenty loopholes to minimise tax 

MK62

kuratowski said:

MK62 said:

......but what would HR taxpayers do with the money they then no longer save into a pension?

Save/invest it somewhere they can access it without waiting for decades.  The 6.25% may not be sufficient inducement to make the money inaccessible for a long time.

Yes, that's certainly a possibility, but I'm not sure why government would be particularly concerned about this tbh ....

Albermarle

MK62 said:

kinger101 said:

Broadly - I think 6.25% benefit is insufficient to encourage saving within an pension.

......but what would HR taxpayers do with the money they then no longer save into a pension?

Do not forget that many HR taxpayers do not take real advantage of pension tax relief even now, or are even aware of it, or do not claim it back. So not sure what % of the population would be that aggrieved if it was removed.
If 15% of those paying tax, pay some tax at HR ( last figure I heard) then some will be paying very little, some will be making only small pension contributions , so maybe half will be affected significantly . Then lots of people do not pay any tax or are not employed etc . So although it is a subject dear to the heart of this forum, maybe < 5% of the population would be that bothered ?

MK62

Albermarle said:

MK62 said:

kinger101 said:

Broadly - I think 6.25% benefit is insufficient to encourage saving within an pension.

......but what would HR taxpayers do with the money they then no longer save into a pension?

Do not forget that many HR taxpayers do not take real advantage of pension tax relief even now, or are even aware of it, or do not claim it back. So not sure what % of the population would be that aggrieved if it was removed.
If 15% of those paying tax, pay some tax at HR ( last figure I heard) then some will be paying very little, some will be making only small pension contributions , so maybe half will be affected significantly . Then lots of people do not pay any tax or are not employed etc . So although it is a subject dear to the heart of this forum, maybe < 5% of the population would be that bothered ?

That's still about 1.6M people though (ie 5% of taxpayers, not 5% of the whole population).......and I suspect a significant chunk would normally be Conservative voters. Then again, they could do it and basically dare a Labour or Labour/Lib Dem government to then undo it........or, and possibly more likely if they have privately given up on winning the next election, wait 2 years and shove the problem onto the new incoming government.......

Albermarle

MK62 said:

Albermarle said:

MK62 said:

kinger101 said:

Broadly - I think 6.25% benefit is insufficient to encourage saving within an pension.

......but what would HR taxpayers do with the money they then no longer save into a pension?

Do not forget that many HR taxpayers do not take real advantage of pension tax relief even now, or are even aware of it, or do not claim it back. So not sure what % of the population would be that aggrieved if it was removed.
If 15% of those paying tax, pay some tax at HR ( last figure I heard) then some will be paying very little, some will be making only small pension contributions , so maybe half will be affected significantly . Then lots of people do not pay any tax or are not employed etc . So although it is a subject dear to the heart of this forum, maybe < 5% of the population would be that bothered ?

That's still about 1.6M people though (ie 5% of taxpayers, not 5% of the whole population).......and I suspect a significant chunk would normally be Conservative voters. Then again, they could do it and basically dare a Labour or Labour/Lib Dem government to then undo it........or, and possibly more likely if they have privately given up on winning the next election, wait 2 years and shove the problem onto the new incoming government.......

Also I suppose some people get agitated about taxes, they do not even pay, like inheritance tax. Its unpopularity seems to extend well beyond people who pay it, or may ever pay it. 

resk

Tax relief miraculously survives for another wee while.  Phew!  

Albermarle

resk said:

Tax relief miraculously survives for another wee while.  Phew!  

No mention of salary sacrifice either .

Maybe a review will be announced at some point.

Mick70

Albermarle said:

resk said:

Tax relief miraculously survives for another wee while.  Phew!  

No mention of salary sacrifice either .

Maybe a review will be announced at some point.

The two would have to go hand in hand , maybe an IT Admin nightmare and a potential backlash for how much they would gain ?