This Law-Now confirms the changes in the 2009 Budget that impact
on occupational pension schemes.
Restriction of higher-rate tax relief
The main headline in relation to pensions is the restriction of
tax relief for the highest earners. From April 2011, for those
individuals with income of £150,000 or more, tax relief on
pension contributions will be tapered downwards so that it falls to
20% for those with income over £180,000. The full details of
how this tapering will work are subject to consultation.
Effective from noon on 22 April, however, the Government is
introducing what it calls anti-forestalling legislation to prevent
the making of "substantial additional pension
contributions" before April 2011 by individuals likely to be
affected by this change. Anti-forestalling will apply to
individuals with income above the £150,000 threshold who
change their normal pattern of pension contributions and whose
pension savings exceed £20,000 per tax year (a sum to
