Tenon director slams pension tax plans
A director at listed accountancy consolidator Tenon has slammed the government's plans to increase taxation on high-value pension schemes.
Link: Rich pensioners face 60% tax charge
Kay Ingram, director of financial planning at Tenon, made her comments in a letter published in the Financial Times today. They came in response to a proposal by the Treasury to charge a 60% tax on pensions whose value are equal to or worth more than £1.4m.
Ingram said while plans to simplify pensions legislation were ‘desirable’ the ‘proposal to tax anyone who builds up a fund of £1.4m after 2004 defies logic’.
She questioned how the amount of £1.4m was arrived at and said the calculations ignored the ‘impact of increased longevity’.
‘The government already takes £5.3bn of tax each year from pension schemes. It is hard to see how additional tax penalties will encourage more saving or strengthen public faith in pensions,’ Ingram concluded.