Redundancy pay now allowed in pensions

HMRC has previously taken the position stating no part of a redundancy payment could count towards earnings, and therefore receive tax relief as a contribution into a pension scheme. However, according to Aegon Scottish Equitable, in the recent changes to the Registered Pension Scheme Manual (RPSM) HMRC has included the information that any part of a redundancy payment over the tax-exempt threshold, currently £30,000, will count as “relevant UK earnings”. As a result, Aegon says an individual can now pay the full amount of the taxable element of their redundancy payment as a pension cont...