Pension tax relief plans are under attack

Politicians are being criticised for using pension tax relief ‘like an election piggy bank’, says Adrian Walker at Old Mutual Wealth, to support policies such as lowering tuition fees and inheritance tax.

The Tories have recently announced that if they were to champion the general election in May, family homes worth £1 million would no longer have to pay inheritance tax if they chose to leave their property with their children or grandchildren. The way in which the latter would be paid for is by lessening the amount higher earners are able to pay into their pensions annually and still be able to receive tax relief. Rumours suggest that the Conservative party revealed in a report a few weeks ago that they would encourage people to put their money into property instead of other investments and equally try to entice older people to upsize in property in order to benefit the lives of their family legacy.

Alternatively, Labour has revealed that if it were to win the election race it would cut pension tax relief to enable a decrease in University tuition fees from £9000 to £6000 a year; hoping to lower the debts of University students.

We shall have to see what the General Election brings!

Have a great weekend