Summary and implications
Changes to both the lifetime and annual allowances from 6 April
2016 are going to affect many scheme members. Trustees need to
understand the new limits, be aware of their obligations and
communicate the changes effectively to members. This includes an
obligation to provide pension savings statements where an
individual has exceeded the annual allowance.
Everything could change on 16 March 2016 when the Chancellor is
due to give the Government's response to its consultation, issued in July 2015, which
sought views on the future shape of pensions tax relief. One
specific reform which is under consideration is a move from the
current EET (Exempt-Exempt-Taxed) system to a TEE
(Taxed-Exempt-Exempt) system. The full adoption of this would mean
no tax relief for employers or employees on pension contributions.
There has been speculation that the Government may keep EET but
apply a common rate of tax relief on contributions (30 per cent has
been
