Chancellor expected to reduce pensions tax breaks to fund the NHS

Chancellor Philip Hammond is expected to cut pension tax relief for thousands of the highest earners taxpayers to help pay for a proposed £20bn a year increase in NHS funding, according to the Daily Mail.

Around £38bn per year is spent on pension tax relief and Hammond intends to redistribute some of this money from ‘people who can afford to put tens of thousands of pounds into their schemes each year’ to the NHS, it states.

Following Theresa May’s promise to increase the NHS’s budget by 2023, Hammond has been tasked with finding the extra funds and has identified the money used for pension tax relief as one of the options available.

The pension tax relief money also hasn’t gone unnoticed by members of the pensions industry, with the Centre for Policy Studies proposing the government scrap the pension tax relief altogether to save the Treasury an estimated £10bn per year in a report yesterday, 27 August.

Hammond’s search has been eased by forecasts of a £10bn surplus this year, but in order to raise enough cash for May’s proposed budget increase the Treasury is also planning to increase alcohol spirit duties and remove tax breaks for investors investing in small companies.

A Treasury spokesman said: “We don’t comment on budget speculation.”

    Share Story:

Recent Stories


A changing DC market
In our latest Pensions Age video interview, Aon DC senior partner and head of DC consulting, Ben Roe, speaks to Laura Blows about the latest changes and challenges within the DC sector

Being retirement ready
Gavin Lewis, Head of UK and Ireland Institutional at BlackRock, talks to Francesca Fabrizi about the BlackRock 2024 UK Read on Retirement report, 'Ready or not. How are we feeling about retirement?’

Podcast: Who matters most in pensions?
In the latest Pensions Age podcast, Francesca Fabrizi speaks to Capita Pension Solutions global practice leader & chief revenue officer, Stuart Heatley, about who matters most in pensions and how to best meet their needs
Podcast: A look at asset-backed securities
Royal London Asset Management head of ABS, Jeremy Deacon, chats about asset-backed securities (ABS) in our latest Pensions Age podcast

Advertisement Advertisement Advertisement