UK. Coronavirus grants pensions Budget immunity
Doctors are the people you need on your side in a time of crisis — as Wednesday’s Budget, overshadowed by the spread of the coronavirus, proved.
The temporary sticking plaster Rishi Sunak provided to patch the NHS pensions taper tax crisis turned out to be much bigger than expected — a £2.2bn giveaway that will benefit the pensions contributions of all workers in the public and private sector earning up to £200,000 per year.
From April, they can hang on to their £40,000 annual allowance rather than see it tapered to £10,000, immediately breathing life into pensions saving for thousands of higher earners.
The chancellor promised the move would lift 98 per cent of senior hospital doctors out of the scope of the annual allowance taper — but one has to wonder why he didn’t go the whole hog and help the remaining 2 per cent by scrapping the taper altogether? Still, it seems churlish to complain when there was not a peep from Mr Sunak about a rumoured review that could sound the death knell for higher rate tax relief on pensions contributions. It appears the corona crisis has granted wealthier pension savers immunity from radical tax cuts, but it could prove to be a temporary reprieve.
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