Pensions tax planning for high earners
Mitigating a high tax bill
With intense pressure on government finances, the overall tax burden in the UK is likely to remain at an historically high level for the foreseeable future, with higher earners continuing to shoulder most of the burden. Higher and additional rate taxpayers currently pay over two thirds of all income tax.
One in six income tax payers is currently taxed at the higher or additional rate and the proportion will increase significantly following the freezing of tax allowances and bands until April 2028 despite recent high rates of inflation, with no guarantees beyond that. The threshold for paying additional rate tax reduced from tax year 2023/24 from £150,000 to £125,140. The threshold for phasing out the personal allowance has been unchanged at £100,000 since it came into force in April 2010.
