CIPP survey on the proposal that tax relief on pension savings be doubled
17 February 2015
The Pensions Minister Steve Webb has announced plans to encourage pension contributions by introducing a 33% flat rate of tax relief meaning that savers would receive a £1 tax rebate for every £2 they pay into a pension. This follows proposals in the report Retirement Savings Incentives , published by the Centre for Policy Studies, which suggested that tax relief on pension contributions should be replaced by a Treasury contribution of 50p per £1 saved, up to an annual allowance, paid irrespective of the saver’s taxpaying status. “If we are to catalyse a broad based savings culture, we need a highly redistributive incentives structure. A 33% flat rate of tax relief (i.e. 50p from the Treasury per £1 saved from net income, which could include employer contributions) would double the incentive that basic rate taxpayers currently receive. This is not necessarily intuitive; the doubling arises because tax relief is calculated on gross (i.e. pre-tax), rather than net amounts. But, for cost control purposes, it would have to be accompanied by a much lower annual allowance, i.e. well below today’s £40,000. In addition, to help broaden the savings base, the saver’s taxpaying status should be irrelevant. It would make sense for employees’ income tax and NICs to be deducted from employers’ contributions, with the Treasury’s 50p paid gross, thus avoiding a potential cashflow issue for employees.” The CIPP Policy team is keen to understand what individuals feel about this suggestion and has created a very quick survey to establish the impact this move would have on individual pension savings. The report states:
We would be very grateful if you could take a couple of minutes to complete this survey which will close on 2 March 2015. Thank you.
Non-guaranteed overtime and holiday pay - second CIPP research survey
5 March 2015
The CIPP would like to understand how the payroll profession is coping with the new holiday pay legislation.
As the payroll profession is aware, late last year the UK Employment Appeal Tribunal case of Bear Scotland versus Fulton, ruled that holiday pay should include non-guaranteed overtime. The CIPP conducted a survey with professionals to understand what this ruling might mean in practice. Since then, in late December the government introduced some measures to try and give some certainty to businesses in respect of the potential costs with this ruling. The government has a taskforce to look at all the implications of this ruling and of course the British Gas v Lock case, following its appeal hearing which has been delayed. The CIPP would like to understand how the payroll profession is coping with this new legislation so far, to be able to feed into the taskforce, set up by Vince Cable MP.
Please spare 5 to 10 minutes (depending on the amount of information) to complete this second CIPP survey .
The survey closes at midnight 20 March 2015. Thank you in advance for your help.
CIPP Policy News Journal
08/04/2015, Page 48 of 521
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