Budget 2010 – Pensions taxation
Major changes to pension schemes are being introduced from 2012 when employers will be required to ensure that employees are either a member of their pension scheme or of the Government’s National Employment Savings Trust (NEST).
The changes announced as part of this year’s Budget will ensure that NEST is subject to the same tax rules as other tax-registered pension schemes.
The pensions legislation will also be amended to:
- remove the tax liability on any interest charges on late pension contributions made by an employer to qualifying pension schemes;
- provide regulation-making powers to deal with any unintended tax consequences that may emerge as a result of the implementation of NEST and the employer duties and compliance as set out in the Pensions Act 2008; and
- remove the tax charge on borrowing linked to the cost of establishing and operating a registered pension scheme, subject to conditions.
The Government intends to legislate this measure in a Finance Bill to be introduced as soon as possible in the next Parliament. The amendments will have effect on and after the date that the legislation receives Royal Assent.