Employers need to prepare for introduction of pensions tapered annual allowance for higher earners
From 6 April 2016, the pensions annual allowance will be reduced for many individuals with taxable income (which includes employer and employee pension contributions) of over £150,000 per year. For individuals with taxable income in excess of £210,000 per year the pensions annual allowance could be reduced to as low as £10,000.
The tapered annual allowance is likely to affect senior people within organisations and it is also likely to lead to a number of queries from employees. Therefore, in most cases employers will need to assess which of their staff may be affected, decide their approach and communicate with their staff (see “Actions for employers” below).
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