Pension savers can breathe easy again after Britain's pensions tax relief system was left intact by the government in the Autumn Statement. It was feared that George Osborne was ready to wield the axe on higher-rate tax relief to save the Treasury around £12bn a year.
But his restraint means savers can still get up to 50 per cent tax back – depending on their income bracket – on contributions into pension schemes. Tax is then paid on pension income in retirement, often at a lower rate.
Meanwhile, a new interpretation of the pension rules has opened up opportunities for pension investors to make significant contributions to their pension scheme this year.