The chancellor removed the Pensions Lifetime Allowance in his Spring Budget, helping those who expect to or have already paid over a million into their pension, which is significantly fewer in number in the UK.
While Hunt aimed to bring senior doctors and consultants back into the workforce by removing the limit, experts have criticised the decision as a “permanent tax cut” for the wealthy.
The reforms do help high earners, but not those who earn over £240,000, as their ability to claim relief on pension contributions tapers off above this level.
Additionally, millions of workplace pension savers will feel no impact from the measures, and younger savers or those on low and middle incomes will not benefit from the removal of the allowance as they struggle with maintaining even the minimum pension contributions.
Whilst some experts see the removal of the lifetime allowance as a welcome change, it is costing the Treasury around £2.75 billion over five years, benefiting only a small group of workers with pension pots worth over £1 million.
The reforms are perceived as disproportionately benefiting high earners, whilst doing nothing to help low or medium earners, or younger savers.
