Three years passed before the Government decided to muddy the waters.

In the April 2009 budget the Chancellor announced that from April 2011, tax relief on pension contributions would be tapered down for those with incomes over £150,000, reducing to the basic rate level of 20% for people on incomes over £180,000. Anti-forestalling measures were put into place immediately, designed to prevent people making large additional pension contributions prior to the April 2011 changes.

That was then, this is now.

The new coalition Government has proposed an alternative approach to take effect from April 2011. On the face of it is looks a simpler option, whereby the annual allowance (currently £255,000) is reduced for all, to a suggested range of between £30,000 and £45,000. Any contributions up to this level would receive full tax relief applicable to the individual, with any excess subject to the annual allowance charge.

As with all changes, there are winners and losers.

Members of final-salary pension schemes would appear to fit in the latter category. This could result in an employee receiving a pay rise, which would not have triggered a tax charge under current rules, having to pay extra tax through their tax returns.

Of course, 8 months is a long time in politics, especially for a relatively new coalition government, so watch this space.

Don’t leave it to chance, call for more information on 0844 848 2277.

FURBS used to offer a great way for employers to provide extra compensation to high paid employees whilst receiving corporation tax relief.

For you the employee, you were able to build up pension provision beyond the set limits, albeit with a watered-down tax benefit compared to approved pensions.

And the best bit, at retirement you could take the whole pension as a lump sum tax FREE!

A-Day and Pension Simplification changed all that!

Now you pay tax on the growth of the fund at the highest rate:

• 40% (rising to 50% from April 2010) tax on savings income;
• 32.5% (rising to 42.5%) on UK dividend income;
• 18% tax on capital gains.
• And even pay income tax when you take the benefits at retirement.

But there is a solution

You can transfer to an International FURBS and pay NO tax on the growth of the fund.

How would you like to take the pension value as a lump sum at retirement totally free of tax?

With an International FURBS you can. Not only will the proceeds pass to your dependants tax-free on your death, it can even reduce your estates IHT bill!

If you think this may be of benefit to you, call for your free consultation on 0844 848 2277.