Last December Chancellor George Osborne cut the maximum contributions to pension plans from £50,000 to £40,000 and reduced the maximum permitted pension pot from £1.5m to £1.25m. Now comes news of a further proposal to restrict pension tax relief – the Labour Party proposes restricting tax relief on pension contributions for those earning over £150,000 a year to 20%.
Politicians do not appear to understand that turning pensions into a political football simply makes people less likely to save. But businesses and their owners can still use pension schemes for highly effective tax planning.
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