Pensions Savings - The Tax Issues

The current pensions tax regime structure was launched on ‘D Day’  6 April 2006. Since then, there has been a plethora of modifications seeking to cap tax incentives, whilst at the same time encouraging a wider uptake of funding for retirement. Perennial speculation about the retention of higher and additional tax relief has been fuelled by the ever increasing cost to the Exchequer. The most recent statistics for 2022/23  revealed a gross pension income tax and NICs relief cost of 70.6 billion!  

In 2023/24, a number of changes expanded the taxation benefits of pension savings, a move which surprised many and which have not been reversed following the change in government.  Instead,  the new government is proposing to tax unused pension funds on death.

The course examines the tax rules and developments involved in providing for and accessing a pension.  

Content 

Pension contributions and tax relief overview

Employer (Workplace) pensions

• Which tax relief method ?
• Common mistakes

The Annual allowance (AA)  

• The excess charge 
• Tapered AA  

Accessing ‘money purchase’ pension funds 

• Income and lump sums including small pension pots 
• Money purchase AA rules and recycling

 The new Lump Sum and Lump Sum ‘Death Benefit’ Allowances

• LTA abolition
• The new allowances
• Benefits taken before 5 April 2024
• Transfers to overseas pension schemes

Protected pensions (DC)

• Overview and impact of developments

The taxation of death benefits 

• The interaction with IHT and estate planning 

The state pension 

• How the  old and new state pension operate 

Pensions and divorce overview