Extra tax relief on pensions contribution – act before you miss out!
Changes to tax relief on pension contributions were announced in the recent budget and you may wish to take advantage of the increased annual allowance for the 2015-16 tax year.
Prior to these changes, tax relief on an individual’s pension contributions was limited to a maximum of £40,000 per tax year (plus any unused amounts carried forward from the previous three tax years).
From 6 April 2016, all pension input periods (the period over which the amount of pension saving under an arrangement is measured) will be aligned with the tax year end. Transitional rules for the tax year ending 5 April 2016 have now been put in place, which means that you could potentially receive tax relief on up to £80,000 worth of contributions during this year (plus any unused amounts carried forward from the previous three tax years), however it all depends on contributions made during this tax year to date.
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Jenny Brown is a personal tax manager at Hawsons, based in the Sheffield office, who manages the personal tax affairs of our clients. She started her career with HM Revenue and Customs, specialising in small business compliance. For more details and advice, please contact Jenny on [email protected] or 0114 266 7141 or your local tax specialist.[/author_info]