Experts dismiss election fix for pension tax woes

By Edie Bourne

Doctors caught out by changes to pension contribution limits are suspicious of a pre-general election promise that they will have their tax paid for them by the NHS – albeit for the current tax year only. 

The emergency measure, which is no help to doctors’ private pensions, promised to allow clinical staff to opt for the pension scheme to cover their excess charges resulting from the ‘annual allowance’ – known as ‘Scheme Pays’ – for the 2019-20 tax year. 

They should then be compensated by the NHS upon their retirement. 

The annual allowance limits the amount of tax-free pension savings which can be accrued each year. The standard allowance is £40,000, but a ‘tapered’ annual allowance was introduced in 2016.