Government rushes through NI cap on pension salary sacrifice
The government has already drafted legislation to impose a £2,000 limit on NI exempt pension contributions under salary sacrifice arrangements. What else do we know?
Despite the limits to the amount of salary employees can sacrifice in exchange for tax free employer pension contributions not coming into force until April 2029, the government has already published the National Insurance Contributions (Employer Pension Contributions) Bill. According to media reports, this is due to the government wishing to "reassure the markets" that it is serious about introducing the cap, which is by and large another NI hike for employers.
The Bill does not tell us how the £2,000 cap will operate in practice, e.g. if an individual has two jobs or changes jobs part way through a tax year. It is understood that there will be a consultation in due course to decide on the details and operation of the £2,000 limit.
Related Topics
-
Company buying back shares? Watch out for forthcoming changes
Company owners arranging a retirement, a family succession or a shareholder exit may need to rethink how shares are bought back. The Budget confirms that the government intends to tighten the rules distinguishing capital gains from dividend income, potentially making some buybacks considerably more expensive. How might an ordinary business exit be caught?
-
What can you learn from HMRC’s input tax toolkit?
You know that penalties can be charged on careless errors and many mistakes relate to input tax being wrongly claimed. How can HMRC’s input tax guidance help your business to claim the right amount?
-
A £3,000 side-hustle allowance: more generous than it looks?
People making money from small side businesses will have more room to earn without paying income tax, following a Budget decision to triple the trading allowance. However, the figure relates to what you receive before expenses, not the profit you keep. Will the £3,000 allowance actually save you tax?