Pensions: Tax Allowances
(asked on 17th March 2015) - View Source
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, how many recipients there were of higher-rate pension tax relief in each year since May 2010; and how much such relief was awarded in each such year.
The estimated exchequer cost arising from income tax relief on contributions made to private pensions, and relief on the investment returns to private pensions in 2013-14 was £34.3bn[1]. Income tax on pensions in payment in the same year was £13.1bn, resulting in a net cost of pensions tax relief of £21.2bn in 2013-14.
The proportion of the cost of income tax relief on pension contributions for varying income ranges and years, is provided in the table below.
% of the cost of income tax relief on contributions | ||||||
Income bands | 2009-10 | 2010-11 | 2011-12 | 2012-13 | 2013-14 | 2014-15 |
Up to £19,999 | 8% | 6% | 5% | 6% | 5% | 5% |
Between £20,000 and £44,999 | 31% | 32% | 35% | 37% | 37% | 36% |
Between £45,000 and £74,999 | 25% | 26% | 28% | 32% | 33% | 34% |
Between £75,000 and £99,999 | 7% | 8% | 8% | 10% | 10% | 10% |
Between £100,000 and £149,999 | 8% | 9% | 9% | 7% | 8% | 8% |
£150,000 or more | 20% | 18% | 14% | 8% | 7% | 7% |
All | 100% | 100% | 100% | 100% | 100% | 100% |
Estimates are based on Surveys of Personal Incomes with projections for 2012-13 onwards. Projected years are subject to uncertainty.
[1] This is published in HMRC National Statistics table PEN6, available here: https://www.gov.uk/government/statistics/registered-pension-schemes-cost-of-tax-relief
Figures for 2013-14 are the latest available.