Overview
- The Society of Pension Professionals warned MPs that curbing salary sacrifice could cut take-home pay, citing a £560 annual hit for a £35,000 earner contributing 5% and the greatest impact for those under £50,284.
- Treasury officials have declined to comment before the 26 November Budget, with decisions expected after 21 November according to reporting.
- Options reportedly under review include removing employer National Insurance relief on salary sacrifice, introducing a flat c.30% pension tax relief, reducing the 25% tax-free lump sum, and possibly reintroducing the lifetime allowance.
- The Institute for Fiscal Studies estimates a £22 billion fiscal gap, a shortfall that has focused attention on pension-related tax measures.
- Industry voices urged calm as some savers reacted to speculation, with survey data showing 8% overall and 23% of higher-rate taxpayers topping up pensions, and advisers recommending sensible planning without knee-jerk moves.