Autumn Statement: Pensions
Tax Relief on Pension Contributions has been further restricted. From 2014/15, the annual allowance will be reduced from £50,000 to £40,000. This is the maximum contribution that can be paid into a pension scheme and attract tax relief.
The lifetime allowance is also being reduced. From 2014/15 onwards, the maximum amount that can be built up in a pension scheme will be reduced from £1.5m to £1.25m. A fixed protection scheme will operate to allow individuals to benefit from the £1.5m limit provided that they stop making contributions or accruing benefits above certain limits.
The Chancellor also announced that for individuals in drawdown pension arrangements, the capped drawdown limit will be increased from 100% to 120%.
The basic state pension will rise to £110.15 a week from April 2013.