Pinsent Masons: Pensions tax breaks not being utilised

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Pinsent Masons: Pensions tax breaks not being utilised

Thu 6th May 2010

Pensions tax breaks are not being used fully by the public because they cannot afford to put their money into such financial products, a representative from Pinsent Masons has claimed.

Robin Ellison, partner at the law firm, explained that people have many other things to pay for, such as housing expenses and the cost of looking after children.

His comments were made in response to research by unbiased.co.uk, which indicated that retirement savers in the UK are missing out on £742 million of tax relief this year by not using up their allowance of additional voluntary contributions.

Mr Ellison suggested that this figure is understated and is more likely to be in the billions than the millions.

But he added: "The tax system does not give tax breaks to pension savers, it gives tax neutrality. That is, you get tax breaks now, but you pay tax when you get the benefits. So it is neutral."

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