Zurich calls on government to apply 33 per cent flat rate of pension tax

 
Caitlin Morrison
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Flat rate of pensions tax will convince more people to save for retirement (Source: Getty)
The government should introduce a 33 per cent flat rate of pension tax relief to convince more people to save for retirement, insurance group Zurich has claimed today.

The firm said a flat rate is a “long-term solution that gives consumers the certainty they need to save”.

Research conducted by YouGov for Zurich has shown that 69 per cent of over-55s said contributing to a pension from untaxed income was the most powerful incentive for them to save for retirement.

“Investing into a pension from untaxed income is a compelling incentive to lock away savings for the long-term,” said Gary Shaughnessy, Zurich UK Life boss.

“Removing such a valuable tax break, as the government is considering, would drive people away from retirement saving.”

He added: “Instead of scrapping pension tax relief, the government should reinforce its value by introducing a 33 per cent flat rate that would be a fairer, simpler and more sustainable solution for people of all incomes.”

He added that taxing pensions upfront like ISAs would weaken the culture of long-term retirement saving.

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