Budget 2012 Pension Annual Allowance and Loopholes

Published / Last Updated on 14/03/2014

Pension Loophole

The loophole that allowed companies to pay pension contributions for an employees spouse or family members creating huge tax losses will be closed.

Pension Annual Allowance

£50,000 is the maximum that can be paid into a pension scheme each year with full tax relief.

In a quick quirp, the Chancellor mentioned that he will restrict tax relief to 25% for contributions in excess of £50,000. We believe, this is to do with High earners making use of carry forward of unused pension tax relief from the previous three years. In short, restricting tax relief to 25% instead of up to 50% or 40%.

Budget Summary 2012