During the 2023 Spring Budget, the Chancellor announced changes to pensions, which may alter the way you save for retirement.<\/p>\n
<\/p>\n
These changes will allow you to save more money and may provide a helpful tax planning opportunity, so it is important to make sure you make the most of them.<\/p>\n
Why have changes been made?<\/strong><\/p>\n The aim of the Spring Budget changes to pension is to motivate older individuals to remain in or re-enter the workforce and save more for future.<\/p>\n Lifetime Allowance<\/strong><\/p>\n The Lifetime Allowance is the maximum amount of pension savings that an individual can accumulate over their lifetime, without tax.<\/p>\n The current limit of \u00a31,073,100 was set to last until 2026, but the Chancellor announced that it will be removed completely. This change will come into effect from 6 April 2023, before the allowance is scrapped entirely next year.<\/p>\n Pension Annual Allowance<\/strong><\/p>\n The Pension Annual Allowance refers to the maximum amount that an individual can contribute to their private pension each tax year without facing additional charges.<\/p>\n The current limit is \u00a340,000, but this will be increased by 50 per cent to \u00a360,000 from 6 April 2023.<\/p>\n Money Purchase Annual Allowance<\/strong><\/p>\n The Money Purchase Annual Allowance is relevant for individuals who have begun to withdraw from their defined contribution pension, but who want to continue working and saving.<\/p>\n Currently, the allowance stands at \u00a34,000 per year before incurring a tax penalty. However, the Chancellor has more than doubled this amount to \u00a310,000, and this will be effective from 6 April 2023.<\/p>\n Tapered Annual Allowance<\/strong><\/p>\n The Tapered Annual Allowance gradually decreases the amount that an individual can contribute to their pension plan each tax year, based on their earnings.<\/p>\n The allowance would not be reduced to below \u00a34,000, but in the upcoming tax year, this lower limit will be raised to \u00a310,000.<\/p>\n The adjusted income threshold for the Tapered Annual Allowance will also be increased from \u00a3240,000 to \u00a3260,000 from 6 April 2023.<\/p>\n If you need help understanding what these changes to pensions will mean for you or how to make the most of this new opportunity, contact us for advice.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" During the 2023 Spring Budget, the Chancellor announced changes to pensions, which may alter the way you save for retirement.<\/p>\n","protected":false},"author":2,"featured_media":5070,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,125,51,31,29,39],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/5068"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=5068"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/5068\/revisions"}],"predecessor-version":[{"id":5069,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/5068\/revisions\/5069"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media\/5070"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=5068"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=5068"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=5068"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}