Hurrah! Pension tax relief unchanged

Although there had been much speculation, the Chancellor stopped short of major pension changes in his 2018 Budget speech, leaving pension tax relief unchanged. Other than the raising of the Lifetime Allowance in line with the Consumer Prices Index to £1,055,000 for the 2019-20 tax year, the rules surrounding pensions will stay the same.


Pensions continue to offer enticing tax breaks aimed at encouraging us all to provide for our later years. If you contribute to a pension, or if your employer deducts your payments from your salary, you automatically get 20% tax relief as an additional deposit into your pension pot. Higher-rate taxpayers can claim an extra 20%, while those paying additional-rate tax can claim back an extra 25%. At age 55, you can take 25% of your savings as a tax-free lump sum. There are different ways of doing this, including taking the tax-free cash only, taking part of the tax-free cash, taking a lump sum including the tax-free element and taking the whole pension fund including the tax-free cash.


The Chancellor announced that the long-awaited ban on pensions cold calling would at last be implemented following Parliamentary review. Cold calling is a common tactic used by scammers to try and access pension pots and has resulted in people losing substantial amounts to fraud.

The government’s new rules make it illegal for companies to call people out of the blue and discuss their pension plans. Unsolicited calls are banned and only companies authorised by the Financial Conduct Authority who have your prior permission, or a trustee of your workplace scheme, will be allowed to call about your pension.


If you’re self-employed, an employee, work part-time, run your own business or have accumulated pension pots with past employers, we can offer you the advice you need. If it’s been a while since you checked out your pension, then why not arrange to see us for a review?

A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.