Tax relief for high earners could be abolished if a coalition government featuring the Liberal Democrats is formed, experts have warned.
This could lead a number of people approaching retirement age to seek equity release advice on how the value of their home could provide a welcome boost to their retirement funds.
According to financial news provider Thisismoney.co.uk, high earners would face being taxed twice if they decide to continue adding to their pension pots after the 40 per cent tax relief is scrapped.
Laith Khalaf, a pensions analyst at Hargreaves Landsdown, told the news provider that the Lib Dems wouldn’t have to fight too hard to get their policy added to the legislative agenda as it could potentially save the government £5.5 billion per year.
"One Lib Dem policy that won’t take too much persuasion to get onto the legislative agenda will be the abolition of higher rate tax relief," he said.
"This would save the Treasury £5.5 billion a year and any collateral damage to the pension system could be laid at the Liberal Democrat door. We could be entering the final few weeks of higher rate tax relief on pension contributions."
Homeowners that are concerned about the future of the UK pensions landscape can find out how the value of their home could boost their finances with the equity release calculator provided by Key Retirement Solutions.
Posted by Claire Ford
