Taxation

Taxes have two purposes for governments: first, to raise the revenue required to fund public services; and, second, to influence behaviour for the good of society in general. As far as pensions are concerned, successive governments have accepted that there is a strong case for using the tax system to incentivise their use as a means for saving for retirement.

The NAPF believes that the pension tax system must return to the clarity and simplicity of the pure EET regime. We recognise that this cannot be achieved easily. But we believe a return to EET, as a practical way to support workplace pensions, should remain a long-term Government commitment. Over time, and as the public finances allow, the Government should:

exempt pension funds from paying a tax on share dividends;
place private sector DB schemes on a level playing field with insured and local authority DB schemes and DC schemes and exempt them from paying VAT on investment management fees; and
exempt schemes from paying Stamp Duty on purchases of shares, securities, land and property.

The previous Government proposed limiting tax relief for higher earners in a way which NAPF and others believed would be highly damaging to UK pension provision. Following NAPF lobbying, the Coalition Government announced an alternative approach based principally on a reduced Annual Allowance, in line with a NAPF proposal. We have welcomed the Coalition Government’s decision and are now working with HM Treasury on the detailed application of that policy decision.

For more information and to contribute to our work on tax, please contact julian.lefanu@napf.co.uk

Budget 2012 – submission by NAPF

19 March 2012

In its 2012 Budget submission, the NAPF calls on the Government to build a better pensions system by taking bolder steps to...

Conflicts of interest: new policy proposals – an NAPF response to Actuarial profession consultation paper

15 December 2011

The Actuarial Profession’s Consultation Paper proposes that the Scheme Actuary should not advise the employer about...

Employer Asset-backed Pension Contributions: NAPF response to HMRC/HMT consultation

22 August 2011

In the March 2011 Budget the Government announced that it would consult on the tax treatment of Employer Asset Backed Pension Contributions (ABCs) as a way of...

Restricting pensions tax relief through existing allowances: HM Treasury response to the consultation on draft legislation

31 March 2011

The Government has published a supplementary document Restricting pensions tax relief through existing allowances: response to the consultation on draft legislation to explain...

Budget submission 2011

07 March 2011

The NAPF’s has urged the Government to be ambitious as it frames its proposals for the 2011 Budget. The NAPF’s Budget submission recommends...

Restriction of pensions tax relief - pension scheme & employer obligations

11 February 2011

HMRC has published in draft The registered pension schemes (provision of information) (amendment) regulations 2011 which set out the new requirements for provision of relevant information by pension scheme administrators and some employers from 6 April 2011...

Pension tax relief mitigation: NAPF response to HMT HMRC discussion document

12 January 2011

NAPF's response to HMT/HMRT's pensions tax charges proposals...

Compulsory annuitisation: The NAPF response to HM Treasury’s consultation

10 September 2010

Pensions tax relief: NAPF response to HMT HMRC consultation

31 March 2010

NAPF response urging the Government to abandon its proposals for pensions tax reform ...