Were you affected by the Pensions Tapered Annual Allowance?

Since April 2016, if your annual taxable earnings were in excess of £150,000 in any tax year then the amount you can pay into a pension and receive tax relief would be lowered. In simple terms, what you could pay in reduces incrementally by £1 for every £2 excess income earned from £40,000 to £10,000.

Due to potential impact in delivery of public services as a result of the COVID crisis the Chancellor increased this income threshold to £240,000 from 6th April 2020. The benefit of this is available to everyone.

It is fair to say that the calculations behind what can be paid in is complex and there is some further detail to look at on an individual basis, but this does present an opportunity to review what can be contributed. Anyone newly or previously impacted should revisit their pension contributions for this tax year.

The window is tight especially with the 2021 Tax Year End falling on the Easter holiday weekend. Whether this is a temporary concession or a longer-term fix remains to be seen, the budget on 3rd March may clarify further.

How can Prosperis help?

At our disposal are detailed calculation and analysis software which will assist in establishing what can be paid, considering options that may exist in previous tax years. Working with you we are ultimately seeking to remove the complexity and allowing us to deliver objective advice so you can grow your tax efficient retirement savings further.

We would be delighted extend the service to the professional community of accountants and solicitors who may have impacted clients and work with you to add further value to your services.

To find out more and for further information on our services, our team remain contactable on 01423 223640 or email us below