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​Government urged to think again on Pensions Tax concessions

17 January 2020


The BDA has urged government to think again on Pensions Tax reform, following reports it intends to simply lift the Threshold Income in a bid to stop NHS staff reducing hours.


Recent BDA surveys indicate half of dentists (50.3%) are actively considering reducing NHS hours to avoid exposure to pensions tax charges.


The BDA has called for more appropriate concessions to streamline the system and remove disincentives that are now steering practitioners away from seeking promotion.


The Chair of the BDA's Pensions Committee Paul Blaylock said:


"If these reports accurately reflect a genuine government proposal to solve the pensions tax crisis, we urge them to think again. 


"Whilst the proposal to raise the Threshold Income will mean that some will not see their Annual Allowance reduced, it does not simplify a ridiculously complex regime which causes headaches for professional clinicians, their advisers and those who administer and manage pension schemes. 


"The proposal does not remove cliff edges which mean that pay rises can result in dentists working more for less money. Nor does it remove the disincentive for many clinicians to carry out extra work or seek promotion. And it will do nothing to mitigate against the impacts of the Lifetime Allowance which is being seen as a cause of early retirements across the NHS.


"It is also very disappointing that there is no mention of reforms that would introduce flexibilities in the NHS Pension Schemes, allowing members to voluntarily build up lower pensions. This solution to the crisis has a wide range of support."


Getting a fairer deal on pensions tax

Dentists working under the NHS Pensions Scheme can face large tax charges, due to the complexity of the current system. We are calling for greater flexibility within the NHS Pensions Scheme to ensure dentists get a fairer deal.