Chancellor expected to cut pension tax relief to fund NHS

Trustees Agenda posted on 9 October, 2018

According to a report in the Daily Telegraph, the Chancellor is expected to announce cuts to pensions tax relief when he delivers this year's budget on 29 October. At the Conservative party conference last week, the Chancellor suggested that he will raise taxes to help fund a £20 billion funding boost for the NHS announced by the Prime Minister in June.

Sources from the Treasury indicate that this is likely to include a cut to the benefits from tax-free pension contributions, which cost the Treasury £39 billion a year, according to the latest official figures. Pension contributions currently benefit from relief paid at the saver's highest rate of income tax, and it is understood that following this budget, this will be amended by either cutting the tax-free annual allowance or lowering the rate of relief.