Xafinity’s Mr Keenan says the predicted reduction in tax relief for high earners may attract some new contributions to Ssas.
At the start of this year, the Financial Times reported pension tax relief for those on higher incomes looks set to be ditched as part of HM Treasury’s overhaul of the pensions system.
According to the FT, chancellor George Osborne is expected to announce a move towards a ‘flat-rate’ government contribution in his March Budget.
Currently workers enjoy pension tax relief at the same rate as their income tax, but the change would see a shift towards a pension savings incentive of between 25 and 33 per cent for everyone, people close to the Treasury have said.
According to the FT article, the changes are unlikely to come into force for at least a year in order to give the industry time to prepare for the reform.
Depending on where the flat rate is set, the changes could save the Treasury billions of pounds a year.