Foster Denovo|News & opinion|News|Warnings over the pension savings caps

Warnings over the pension savings caps

Employers have been urged to help staff understand the tax implications of the lower annual and lifetime allowances for pensions.
The warning, from employee benefits specialist Secondsight, comes ahead of April’s changes under which high earners could face an unexpected tax bill of up to £13,500.

From 6 April, the annual allowance – the amount an individual can save into a pension withour being taxed – will be tapered from £40,000 for those with earnings of £150,000 or more down to £10,000.

Although few staff have a salary of £150,000, because the definition of earnings is ‘adjusted’ to include employer pension contributions and other income from savings, bonuses or even buy-to-let properties, more people are likely to be affected.

Darren Laverty, Partner at Secondsight, said many individuals and employers were unaware of the impact of this change.

Read the article from Pay & Benefits in full here.

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