Pension charge loophole is shut

Employers who make asset-backed pension contributions to their company’s pension scheme will receive less tax relief, the government said yesterday, closing a popular loophole used by a growing numbers of firms. A new Finance Bill 2012 was introduced with immediate effect to ensure that any payments now made will not allow businesses to claim “excessive” tax relief. PwC partner Alex Henderson said some sort of intervention was expected as the chancellor was keen to raise money from it, but it was positive to see that the proposed changes only aimed to restrict the scope of the tax relief, not abolish it. “Employers will be pleased to have the additional certainty of specially designed legislation,” he said.