Wherever you are with your retirement objectives, do not be swayed from considering action, it s not too late. There are however steps you can put into place to increase the money you’ll receive when you finish working.
Pensions are a very tax-efficient way to save. If you already have a pension, now would be a good time to talk to us about making a lump sum contribution to improve it, particularly as the end of tax year is speedily emerging, or starting a SIPP to improve your choices. You will not have to draw all your pensions at the same time.
If you’re self employed, you can contribute up to 100 % of the value of your relevant UK salary (salary and other earnings), up to a maximum of 245,000 for the 2009/10 tax year rising to 255,000 for the tax yr 2010/11. Contributions above this yearly limit are allowed but will be taxed. You can invest into any number of pension schemes (personal and/or company) each year.
You ll get tax relief on your contributions, so if you are a forty % tax payer a 20,000 contribution would cost just 12,000. Basic rate tax relief is added by the government to all contributions at a rate of twenty%.
Forty percent tax payers can obtain up to a further 20% tax relief via self assessment. If you earn more than 150,000 you will see the tax relief on your pensions cut from April 2011, tapering from 40 to 20 % for those earning more than 180,000. Wage Earners beneath 130,000 will not be impacted.

There s a lifetime limit on the amount of your pension savings, which is currently £1.75m in the tax yr 2009/10 but rises to £1.8m for the 2010/11 tax yr. If your investment fund tops this, you ll incur tax charges of 55 per cent if the excess benefits are taken as a lump sum and 25 percent if taken as income. The income will then be subject to income tax at your highest rate.
From 6/4/10, the age at which you can start taking your pension increases to fifty five. If you need to, pension benefits can be postponed until you are up to 75 yrs old. You may still be able to take your pension before age fifty five in certain circumstances, e.g if you retire through ill-health.

Consilium Asset Management Limited supply advice on self invested personal pensions /sipps in South Gloucestershire.

The value of investments and the income from them can go down as well as up and you may not get back your original investment. Past performance is not an indication of future performance. Tax benefits may vary as a result of statutory change and their value will depend on individual circumstances. Thresholds, percentage rates and tax legislation may change in subsequent finance acts.