Tax target
NHS pension provision has for decades been a major benefit for dentists working in the National Health Service. In his recently published Autumn Statement, George Osborne signaled once again that pensions are in his firing line. And for high performing dentists in the NHS, the changes will have major significance.
The Chancellor announced that the annual allowance, the amount that is put into a pension without triggering a tax charge, would decrease from £50,000 to £40,000 and that there would be a reduction in the lifetime pension allowance from £1.5m to £1.25m, both from 2014/15.
This follows changes from previous years, whereby the:
If you are thinking that sums such as these could not apply to you, you probably need to think again. NHS dentists are part of a defined benefit pension scheme, and so the tax thresholds apply to the ‘deemed’ value of your pension pot, not your contributions to it.
Nick Ledingham, chairman of NASDAL and a partner in specialist dental accountants Morris and Co said: “As with most things relating to dentists’ pension matters, the rules relating to contribution limits are particularly complicated. NHS Pensions are really going to have their work cut out producing the new Pension Savings Statements for dentists.”
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