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Barnett Waddingham
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Senior staff – get ready for April

Published by Bhargaw Buddhdev on

With effect from 6 April 2016, the ability for senior staff to make tax-efficient provision for their retirement is being cut back – drastically in the case of those earning more than £150,000.

At the same time, there are various ‘protection’ regimes being introduced to mitigate the effects of some of these changes.  All senior staff need to examine their own circumstances to plan for the impact of the new tax rules.

At one extreme, individuals may decide to opt-out of pension provision completely – in which case they will be looking for additional payments from their employer in lieu of its expenditure on their pensions.  At the other extreme, individuals may decide to continue accruing pension benefits despite the tax penalties, on the basis that the reduced benefits they will receive still represent good value for their own contributions.  There is a whole spectrum of intermediate options.

What next?

If they have not already done so and as a matter of some urgency, employers need to decide what level of assistance they wish to give to senior staff to facilitate their decision making. This could include:

This could include:

Written material

One-to-one meetings

Seminars for senior staff

At senior management level, individuals can have very different requirements and one-to-one consultations are often desirable for the top few members of staff.

About the author

  • Bhargaw Buddhdev

    Bhargaw Buddhdev is a pensions actuary and he is our expert for dealing with pension taxation issues for individuals and their employers.

    View Biography

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