After much speculation, the Treasury has announced that it would not be looking to implement ‘significant changes’ to the UK’s pension taxation system. The proposals that were being considered included a possible move to a flat-rate pensions tax relief or an ISA-style form of limiting the tax efficiency of pensions contributions.
Recently the chief executive of investment service company AJ Bell (Andy Bell) wrote to the government’s Pensions Minister requesting that they consider a “more measured, long-term approach to pensions tax policy”. Mr Bell received a response from Jane Ellison (HM Treasury Financial Secretary) that provided assurance that in light of the extensive consultation conducted only last year “now is not the right time to undertake significant reform. Given this, the government does not think it is necessary to convene an independent pensions commission at this time”.
With the government’s focus firmly fixed on the Brexit process and the assurances provided by the Treasury recently any future changes to the pensions taxation system are not expected for some time.