Following the recent 2015 Summer Budget, there will be a new tapered annual pension allowance brought in from April 2016 for higher earners. This will potentially have the impact of reducing the current £40,000 annual pension allowance to £10,000.
This change will mainly affect those who have “adjusted annual income” over £150,000, but those who earn over £110,000 may also be affected. All personal and employer pension contributions paid count towards the definition of adjusted income.
For every £2 of adjusted income over £150,000 an individual’s annual pension allowance will be reduced by £1, down to a minimum of £10,000. The level of adjusted income at which the maximum reduction in the pension annual allowance is reached would be £210,000.
Further information will follow in advance of this coming into effect in April 2016, however should you have any questions in the meantime please contact firstname.lastname@example.org or email@example.com.