Pensions Taxable Amounts to Increase


There is a certain amount you are allowed to save throughout your lifetime for your pension which has tax breaks, but the tax breaks are due to rise for the very firs time since April in 2010. This has been confirmed by the government and is something everyone who is saving into their pension pots needs to be aware of.

As of April 2018, the lifetime allowance for pension contributions will be increased by £30,000. Which will take the lifetime allowance from £1 million to £1.03 million. All pensions are tested for lifetime allowance at different points, this is also done when you make your first withdrawal, then at the age of seventy five. Any excess would result in tax charges. When the charges are applied, the tax relief is wiped away on all contributions.

There has been a forty three percent reduction in lifetime allowances over the past seven years, even with the increase which was announced in the Budget. You could save £1.8 million into a pension in the 2010 / 2011 tax year.

Investment Growth Penalized

The biggest concern for us as a leading professional financial advisory firm is that the lifetime limit is penalizing investment growth and reducing the number of people who are saving as a result.

This is not the only allowances which have been penalized, though the majority have been penalized in line in inflation.

Get Professional Advice

We all know how important it is for you to be saving towards your retirement right now, whether you are twenty or fifty. People are already having to work later in life to secure their State pensions and now you need to also be paying into a pension pot which will enable you to live comfortably in your older age.

That being said, the most practical option is to ensure you seek professional financial advice, so you can make an informed decision on how to proceed and ensure you secure the best tax benefits and money in the long run. We are on hand to provide you with all the information and assistance you need, providing a completely unbiased service and providing you with solutions you can trust.

It's essential that you don't take matters into your own hands. If your company is trying to offer you an alternative pension plan or you work for yourself and want to start saving for the future, securing financial advise will provide you with the best possible outcome.



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