8th July 2015
The Government has broadened changes to pensions tax relief hitting more people than those on £150,000 by including pension contributions.
The stated plans were for those earning over £150,000 to see their annual allowance tapered to a minimum of £10,000. But by including employer and employee pension contributions in an “adjusted income” threshold, the cut has been extended down the earnings scale.
The Budget document says: “From April 2016 the Government will introduce a taper to the annual allowance for those with adjusted annual incomes, including their own and employer’s pension contributions, over £150,000″.
For every £2 of adjusted income over £150,000, the annual allowance will fall by £1 down to a minimum of £10,000 for those earning over £210,000.