A key issue for high net worth individuals
Date: Thursday 22nd November, 2012
Author: Anne McClean
Profile: Anne McClean
Reports have emerged in recent days concerning a further potential change to the Annual Allowance provision for contributions to pension arrangements in the Chancellor’s Autumn Statement
The current allowance is £50,000, but this could be curbed to £40,000 or less.
With the reduction in the marginal tax rate for those with income in excess of £150,000 to 45% scheduled to take effect in April 2013, this is a key time for people to consider funding pension to the maximum extent possible.
It is conceivable, subject to having sufficient earned income against which to claim tax relief, that some clients could contribute up to £250,000 gross to their retirement fund at a net cost of as little as £125,000.
As Defined Benefit schemes and employer contributions can affect the amount of Annual Allowance available to you, advice should be taken before any contribution is made.
Please note that the opinions expressed in this blog represent the views of the author and not the views of Mercer & Hole.