Planned tax raid on private pensions by the government

This government will make everyone poorer. U.K. per capital GDP is already on par with Mississippi, the poorest state in America. You get what you vote for. But hey, at least they’re taxing education 🤡!

I think that is the challenge. Public sector wages will rise. Taxes will rise to pay for this, and then many Public sector workers won't be much better off in real terms. Any payrise for me as an experienced health professional will push me into higher tax bracket, will make my pension contributions on my total salary (not just the higher portion) rise, so I will probably only see 30% of the payrise.

Then the increase in borrowing to pay for this and effect of higher salaries may push up inflation, and interest rates, and it's likely that in real terms I will be no better off in real terms, and lower paid people and private sector workers will be worse off. Raising nhs salaries is a propaganda exercise which looks good as the government is linking higher salaries to better care. But it will be interesting to see if this is the reality, my prediction is that it won't. My teams single biggest challenge is 'entitlement'. We are shouted at when people aren't seen as soon as they feel they are entitled to. We are insulted when people can't be seen at the times they feel they are entitled to. We are harassed when we discharge people who don't turn up. We are criticised when we are running late. We have complaints made when people lose their medical equipment and we don't have the budget to replace it immediately. Our professional opinion is disparaged by Google drs who think they know better

If people are being taxed more under the headline 'it will improve nhs services' they will feel even more entitled and we will get even more abuse, more staff will leave and wait lists will go up.

Well if you’re losing it, you’re losing it? What’s the point in making the contribution in the first instance? You can adjust your contribution each tax year?

Nor Brown's raid by removing the tax credits on dividends.

Whatever they do, it can't be as big a steal as that bastard Lawson got away with when he cut back pension scheme surpluses just before the market crashed.

Me neither. I know who's done the most damage to this country over the last 30 years and it ain't Labour.

IMO

Let's remember that those paying "higher rate" tax are those earning just over £50k. This is hardly megabucks because the tax bands haven't increased for years and changes to the exemption for this group will affect a lot of those on middle incomes. The last thing we need as a country is to disincentivise saving for retirement.

What would they do that? They’re still losing the tax relief.

Yes, they'll start drawing it down and paying tax on their pension when they retire, but that kind of pension pot is like a free cashflow boost to the government if they can find a way to get their hands on some of it.

That could be done quite easily by reintroducing the lifetime allowance but not allowing transitional protection.

Surely high tax payers would be inclined to limit their pension contributions and for example pay down their mortgage / look at other investment portfolios that aren’t pensions? Would that benefit the government?

Could probably save a bit of money by removing DB schemes entirely for new entrants to the public sector and just offering a DC scheme (it’s an option in the civil service anyway). In quite a few jobs there isn’t really a pay differential between public and private sector now, anyway.

Then increase the pay of junior doctors so that they are more likely to stay in the UK and the profession.

I can understand the temptation to raid some high value private pensions. I know someone that started their own construction business and just by luck bought an industrial property in an area that was then subject to massive development 40 years later. They sold their very small property plot (which was owned by their SIPP) to a developer for over £10m.

That property "profit" was never subject to any tax, so there is about £15m sitting in that pension fund that has never had any tax paid on it. In fact, the fact that the company paid rent TO the SIPP for years also then reduced the company's tax liability over the years too.

Yes, they'll start drawing it down and paying tax on their pension when they retire, but that kind of pension pot is like a free cashflow boost to the government if they can find a way to get their hands on some of it.

A lot of not so well off people use the lump sum to pay off the mortgage or other debts, not everyone can afford to go on a cruise with it.

Why should doctors get pension pots so massive that we have to rejig the tax laws in order for them

Because we need them and there’s a shortage of them. It’s known as supply and demand.

I agree. It's a VERY slippery slope to have different tax rules for different occupations. Grossly unfair.

If people have a very high pension pot, ALL people with similar values of pension pots should be taxed the same.

The problem with doctors was that the LAW regarding the punitive tax charge on high pension pot values was flawed.

The thing that is easiest to do is to include pensions in inheritance tax, I think you can only pass on DC pensions to your children, if you wanted to pass on a DB pension to adult children you would have transferred it out, a few years ago there were quite good deals for transferring out.

Stalin had nothing on this! 😮

You mean a two tier system, worse than now even, between the state and private sectors. Unsustainable, unfair, and will bankrupt the country. UK Plc is effectively unable to cover state pension provisions already.

The last Labour Govt raided your pension too - unfortunately most people didn't notice ( they removed the tax relief on the dividends within pension funds). This made a huge difference to the amount that people get from them and is one of the reasons we went from having gold standard pension provisions to the low levels we have now.

I'm not a bit surprised that they plan to do it again. However I doubt very much that MPs pensions will be affected.

Fine by me. They’ll spend it on stuff that benefits us all.

There as the last Tory government left a complete mess after giving all their chums our money.

They're coming for your money any which way they think they can get away with it. They're the Labour Party, that's what they do.

I am not in UK. Is the 40% tax relief on pensions unlimited or is there a cap on the amount on which relief can be claimed?

There is an annual allowance of between £10k and £60k. Any pension pot growth above your annual allowance is taxed at your highest tax rate. This is very simple for DCS, but virtually impossible to calculate in advance for DBS, so you get random enormous tax bills.

Why should doctors get pension pots so massive that we have to rejig the tax laws in order for them still to get such a massive amount of tax relief, and yet we also have to put up with junior doctors strikes at the other end of the career pathway.

Because the tax laws were never designed for defined benefit schemes, they were designed to stop people avoiding tax by putting huge amounts in defined contribution schemes.

With a DCS you can avoid annual allowance tax by just not paying so much into your pot, it's your choice. With a DBS scheme you must pay exactly what you're told to pay as a % of your salary. Mine is currently 12.5% so it's not cheap. The only way I can manipulate what I pay in to try and avoid an annual allowance charge, is by choosing to either leave the scheme, or to do less hours.

Not really ideal to have senior doctors working less when the government are so concerned by the ever-growing waiting lists, is it?