CIPP survey on the government consultation on pensions tax relief
21 August 2015
Following the announcement in the Summer Budget, the government published a consultation on pensions tax relief and how it can encourage people, especially low to moderate earners, to save for their pension.
Increased longevity and the changing nature of pension provision provide the basis for considering how the government can best support people to save into their pension. The government needs to make sure that the system encourages more people to ensure that they have sufficient savings for later life.
The current system of pensions tax is simple in principle. Individuals are encouraged to defer their income and pay tax on it when they retire. A sound case can therefore be made that the best method of achieving the government’s aim of fostering a strong culture of saving is to retain the current system, particularly as it is deeply embedded in many processes used by employers and pension providers.
However, the government is also interested in exploring options for how the system of pensions tax could be reformed to strengthen the incentive to save. The principles the government believes any reform should meet are:
- that it is simple and transparent;
- it must encourage employees to take personal responsibility;
- built on the early success of automatic enrolment; and
- be sustainable in terms of being aligned with its long term fiscal strategy.
The CIPP’s Policy Team has created a survey to obtain your views on how these principles could best be achieved. The survey should take around 20 minutes to complete and will close on 14 September 2015.
We hope that all of you will manage to find the time to complete this survey as this is something that will affect us all, both as a profession and as individuals. Thank you in advance for your time and input.