By David Porter, Financial Planning Consultant, Armstrong Watson LLP

NO Government can continue to borrow at the rate the UK Government is doing so and many economists expected the now-cancelled Autumn Budget to be the moment when the brakes would start to be applied.

However, despite the budget’s postponement, the Chancellor will have to look at ways to make savings and his party’s 2019 election manifesto pledge not to increase income tax, National Insurance contributions and VAT rates, would suggest he will look at other ways to increase tax that do not involve changing the rates. One area, which many commentators feel could come under the microscope, is Tax Relief on Pension Contributions.

Why now could be a good time to consider the benefits of extra pension contributions…

• In July the Government launched a consultation on a technical aspect of pension income tax relief, a move that could be seen as a precursor to a broader reworking. A flat rate of tax relief for all pension contributions has long been argued over by a variety of stakeholders and despite the cancellation of the Budget, the Chancellor has still asked for the review to continue.

• Although the Chancellor actually added to the cost of pensions tax relief in March - relaxing the annual allowance rules for higher earners and increasing the threshold limit by £90,000 to £200,000 and the adjusted income limit of £240,000 for the 2020/21 tax year - there is now a distinct possibility that come his next budget, he could look at this closely again.

Taking these potential changes into consideration, if you are considering advice around retirement, investing or even inheritance tax planning, now could be a good time to do so, whilst all existing reliefs and allowances remain available for those who are in a position to take action.

To discuss your retirement, tax or investment planning, please get in touch with David Porter on 0776 695 3454 or email david.porter@armstrongwatson.co.uk