If a person begins to take money from their pension pot, the amount they can pay into a pension and still receive tax relief on may reduce.
The tax charge is one many people will be keen to avoid, but could trigger without even realising it.
Mr Tully continued: “The Money Purchase Annual Allowance will unwittingly catch out ‘pension dippers’ who want to continue working, given the prevalence of workplace pension schemes.
“The MPAA is an arbitrary allowance which is easy to increase or remove altogether, and would allow savers to rebuild their pensions, especially in light of the pandemic and resulting uncertainty created.”
This post originally posted here Daily Express :: Finance Feed