New rules for tax relief on pensions

[levers]

I was just reading about the new rules for tax relief on pensions and the introduction of the annual allowance and abolition of the pension schemes earnings cap on "A Day". If I understand correctly, does this mean that employees currently earning above the earnings cap will be a lot better off due to receiving more tax relief? For example, if I earn £400,000 and pay 15% towards my pension (ie £60,000) i currently only get tax relief on 15% of the earnings cap i.e 15% of £105,600 ie £15,840 whereas from April, I would get tax relief on the whole £60,000 because it is below the £215,000 annual allowance. Have I understood that right? Thanks

[Andy Wood]

Yes youÂ’ve got it spot on.

Tax relief is restricted to 100% of your earnings.


Cheers

Andy Wood CTA DipPFS

awood@clbcoopers.co.uk
01204 551124