UK. Pensions tax relief set to cost government almost £40bn
Pensions tax relief will cost the government almost £40bn this year, up more than £2bn on the previous year, illustrating the growing cost of subsidising retirement saving.
According to new statistics from HMRC, tax relief on employee pension saving is set to rise to £21.2bn while the tax giveaway on employer contributions to occupational pension schemes hit more than £18bn.
The increasing cost of providing pensions tax relief follows a surge in the number of employees paying into company retirement schemes.
In the financial year 2017-18, 10.4 million individuals contributed to a registered pension scheme, up from 9.4 million in 2016-17.
But the average level of contributions fell, leaving the bulk of tax relief to be claimed by higher-rate taxpayers, who pay 60p from every £1 of pension contribution compared with standard-rate taxpayers who must pay 80p for every £1 of pensions saving.
Read more @The Guardian
