The lovely Chancellor, in all of his wisdom, is considering implementing a flat rate of tax relief for pensions. Therefore rather than the current system of 20% tax relief if you are a basic rate tax payer, 40% if you are a higher rate taxpayer and 45% if you are an additional rate taxpayer, everyone will get the same rate. No prizes for guessing that it will not be beneficial for higher rate taxpayers.
Who knows whether he will actually do it, but the rumours are that it will be implemented in his Budget, which is due on Wednesday 16th March and that it will be implemented straight away, leaving no time for a rush to fill your pensions before the rate of relief drops.
So, if you are considering putting any money into your pension and you are a higher rate or additional rate taxpayer, I would suggest that you looked at this sooner rather than later.
Now, the Chancellor may not make any changes, but he might, so I’m just pre-warning you. We will have to wait and see what he does on Budget Day. He hasn’t messed around with pensions for a few months now, so it must be time for another change!!
