Kevin Read discusses the recent changes to the tapering of the pension annual allowance and reminds readers of the importance of ‘scheme pays’ elections.
Had George Osborne got to complete his reform of pensions, there would probably no longer be any higher rate tax relief on pension contributions. However, the restrictions he introduced on top rate tax relief (i.e. via a tapering of the normal £40,000 annual allowance) are still with us and, in the context of defined benefit schemes for doctors, they received a lot of bad publicity in the months before the Budget.
Finance Bill 2020 contains provisions to relieve some of these concerns, by making sure that the restrictions will apply to far fewer taxpayers.
This is achieved via a £90,000 increase, from 6 April 2020, in each of the two thresholds contained in the