Our statement on the Spring Budget 2020
The Chancellor delivered the Spring 2020 Budget on 11th March 2020. To clarify for our clients, we have summarised the key financial planning changes below:
Tax relief on pension contributions
Those earning around or below the level of the personal allowance and saving into a pension may benefit from a top-up on their pension savings equivalent to the basic rate of tax, even if they pay no tax.
Whether they receive this top-up depends on how their pension scheme administers tax relief. Essentially, those paying contributions via the Net Pay method (usually company schemes) don’t receive the top-up, which contrasts with those making the contribution to a private pension that operates the relief at source method. If making pension contributions via Net Pay, the employee is therefore losing out on basic rate tax relief under these circumstances. The government has committed to reviewing options for addressing these differences.
Pension lifetime allowance