Pensions tax planning for high earners

Mitigating a growing tax bill

If you are a high-earner and feel you are paying more and more tax, you are not alone. Increasing the tax burden for higher earners has been a deliberate policy of successive governments. Higher and additional rate taxpayers now pay about two thirds of all income tax.

One in seven income tax payers are currently taxed at the higher or additional rate and the proportion will increase significantly following the freezing of tax allowances and bands until April 2026 despite recent inflation, with no guarantees beyond that. The thresholds for phasing out the personal allowance and the start of the additional rate tax have both been unchanged since they came into force in April 2010.