From 6 April 2006 (A-Day), HM Revenue and Customs (HMRC) changed the way it limits tax-free pension savings in ALL approved pension schemes.

Historically there have always been limits on what you can pay in to a pension scheme and the maximum benefits you can receive. The limits prior to 6 April 2006 on maximum permitted benefits were very complicated, different rules applied depending on when you joined the scheme, your salary, the reason for retirement or leaving and the length of time you were in a scheme.

When the simplification of pension taxation was introduced in April 2006 transitional protection from a potential lifetime allowance charge was available for certain individuals. These are known as enhanced protection or primary protection. If you have not applied for either of these forms of protection you are no longer able to. Please refer to the HMRC website for full details on how these forms of protection work.

Last year the government announced significant changes to the rules governing pension saving for high earners.  Further details can be found at the links below.  Please note that the changes start to effect members who have taxable incomes in excess of £100,000.00 and income for these purposes includes all forms of taxable income (not just salary from employment).

If you have any queries, require more detailed personal information or have registered for protection please contact Maureen Gibbons.  If you require specific advice please contact a licensed independent financial adviser.  Trained Independent Financial Advisers (IFA) can be found on the USS or NHS websites.

Further information about the Government proposals can be found on the HM Treasurey website, along with a basic guide to how the annual allowance will work.