Why the Chancellor should consider dual-system pensions tax relief

Announcement expected in the Budget

Jonathan Stapleton
clock • 2 min read

Speculation is growing the Chancellor will introduce a Pensions ISA on March 16 but could he decide to keep the old system as well? Jonathan Stapleton looks at the benefits of a dual-system approach.

There is increasing speculation the Chancellor is gravitating to a reform to pension taxation based on an ISA style system, where the tax relief is restricted to just basic rate, but withdrawals are tax free. But what would happen should the government decide to continue with two tax regimes - allowing people to both make contributions to a modified EET system (with a reduced annual allowance of £10,000) as well as introducing a Pensions ISA with an annual contribution limit of £10,000 for additional retirement saving? Such a dual-approach system could have significant advantages F...

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