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Retirement savings could lose out on millions in tax relief

05 May 2010 / by Lois Avery

Pension savers could miss out on £742million this year by not saving tax efficiently.

According to unbiased.co.uk, in their TaxAction 2010 report, employees in company pension schemes are set to miss out on an extra £742million tax relief this year by not making additional pension contributions.

Their research has shown that higher rate taxpayers who are members of their employers' occupational pension scheme will miss out on the extra tax relief by failing to make Additional Voluntary Contributions (AVCs).

AVCs run alongside employers' pension schemes and allow employees to pay extra into their pension which should result in a larger pension pot at retirement

Karen Barrett, chief executive of unbiased.co.uk said: "Failing to save for retirement has become an increasing problem for the UK population. The financial meltdown experienced over the last two years further compounded this problem, as the value of people's pension funds has decreased.  And furthermore people have put off saving for retirement as their day to day money worries have taken priority. 

"A discussion with an IFA is a good way to ensure you are planning effectively for your retirement and get your financial affairs in order. Consumers should take action now and can carry out a free and confidential search on unbiased.co.uk's ‘find an IFA' service to find an independent financial adviser who can offer invaluable advice on the best way to save for retirement." 
 
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