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<p>Pensions tax relief is one of the most expensive reliefs in the personal tax system.
In 2020/21 Income Tax and employer National Insurance Contributions relief cost £67.3
billion. The annual allowance helps to ensure that the highest earning pension savers
do not receive a disproportionate benefit. 99 per cent of pension savers make annual
contributions below £40,000, the level of standard annual allowance which has applied
from 2014/15.</p><p> </p><p>An unregistered scheme for the NHS would not benefit the
vast majority of NHS staff, as members would receive no tax relief on their contributions.</p><p>
</p><p>The Government is committed to ensuring that hard-working NHS staff do not
find themselves reducing their work commitments due to the interaction between their
pay, their pension, and the relevant tax regime. On 22 September, the Government
announced it will change elements of the NHS Pension Scheme to help retain doctors,
nurses and other senior NHS staff, to increase capacity. These changes include:</p><ul><li>Changing
pension rules regarding inflation</li></ul><ul><li>Encouraging NHS Trusts to explore
local solutions for senior clinicians affected by pension tax charges, such as pension
recycling</li><li>Implementing permanent retirement flexibilities and extending existing
temporary measures to allow our most experienced staff to return to service or stay
in service longer.</li></ul>
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