Pensions tax restriction

In my article ‘Not enough fingers’ I discussed the pensions proposals for the high income excess relief charge (HIERC) which is designed to restrict higher-rate tax relief on pensions savings made from 2011/12. The proposals include a new version of the definition of relevant earnings for the purposes of the restriction.

I want to draw to the attention of advisers that this does not affect the definition of relevant earnings for the purposes of the special annual allowance charge (pensions anti-forestalling) that applies to restrict tax relief for higher earners on certain on–off or irregular contributions made in 2009/10 and 2010/11.

That definition of relevant income is found in FA 2009 Sch 35 para 2(1) as modified on 9 December 2009 so that an individual will be a high income individual for the purposes of the special annual allowance rules if their relevant income for the...