TaxPersonal TaxPensions relief restriction plans must be halted, says CIoT

Pensions relief restriction plans must be halted, says CIoT

Tax relief taper plans must be rethought to avoid massive red tape burden

Advisers are disappointed that the government is pushing on with introducing
restrictions on pensions tax relief for higher earners from 6 April.

The government had been warned that the changes, which would see tax relief
tapered from 50% to 20% for those earning between £150,000 to £180,000, would
create an unnecessary administrative burden.

“The government’s proposed method of restricting tax relief will cause
disproportionate complexity and an increase in the costs for employers, pensions
scheme and the pensions industry as a whole,” said Colin Ben-Nathan, chairman of
the CIoT’s employment taxes sub-committee.

“Even the government’s own figures indicate that the compliance cost on
business will be in the region of £1bn in the scheme’s first year alone.”

The
CIoT
wants the government to hold fire and enter into another consultation on its
plans. Its alternative proposal would be to limit the amount that people can
place into registered pension schemes.

Further reading:

Read
the Treasury’s documentation on its plans

Pensions
chief demands reform of accounting

Barclays
accused of using pension savings to fund bonus tax

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