The government has announced temporary tax changes designed to protect the pension income of key workers in the public sector returning to work to support Covid-19 efforts, such as NHS doctors and nurses returning to work after the recent Government request.
The tax rules in question would otherwise apply “significant charges” to the pension income received by recently retired individuals between 50 and 55 should they return to work.
The measure is designed to ensure that we can continue to provide important public services at this time. This change, taken alongside complementary changes to rules for relevant public service pension schemes, will help ensure individuals UK pension income will remain protected if they return to work at this important time.
The government’s actions will provide relevant public sector staff associations with the assurance that their members with pensions in payment and pension benefits will be unaffected if they wish to play their part in our response to this virus. The proposed tax changes specifically formed part of the government response to Covid-19, and as such would initially apply in respect of payments made from 1 March to 1 June 2020 only, with further limits on who the easements apply to.
In March, the Coronavirus Bill: health and social care measures confirmed similar changes to the NHS pension scheme rules, again designed to protect the pension income for recently retired workers should they return to work to aid in the fight against Covid-19.