Pensions paper trail

Kelly Sizer reflects on the pensions money purchase annual allowance, how taxpayers might avoid triggering it and compliance pitfalls

When pensions flexibility (or ‘pensions freedom’) was introduced from 6 April 2015, the government – understandably – wanted to prevent taxpayers from doubling up on tax relief through ‘recycling’, by taking pensions savings out and then re-contributing them. The money purchase annual allowance (MPAA) was therefore introduced by the Taxation of Pensions Act 2014 Schedule 1 Part 4 (amending Finance Act 2004).