Pension Input Period
For the tax year 2011/12 onwards the introduction of new tax regulations make it much more important to know what the scheme’s Pension Input Period is.
The government has confirmed that major changes have been made which will affect the taxation of pensions both whilst accruing and at the point at which benefits are drawn. The key change is that the Annual Allowance (AA) which limits the value of the benefits that can accrue in any one Pension Input Period (PIP) before the excess over the AA is subject to tax, will be greatly reduced with effect from 6 April 2011. The AA will be reduced from £255,000 per annum to £50,000 per annum and this lower amount represents the maximum increase a member can enjoy to the capital value of pension benefits over a single PIP before the excess will be subject to tax.
The nominated Pension Input Period for UGPS is 1 April to 31 March the following year.