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'We need action, not another review'

A report into the tapered annual allowance is expected by early February, but that's not soon enough for one campaign group.

Despite the new government only being formed six days ago and with Christmas looming, Royal London has called for more urgency.

Health Secretary Matt Hancock has announced that there will be an "urgent review" of the taper.

That followed a manifesto pledge to conduct a review within 30 days of the general election on 12 December 2019.

The taper applies to people with a taxable adjusted income of more than £150,000 and a threshold income over £110,000.

For every £2 of income an individual has over £150,000, their annual allowance is reduced by £1, down to a minimum of £10,000.

The rules have caused unexpectedly high tax bills for some NHS professionals, who have been refusing to take on extra shifts as a result.

Steve Webb, director of policy at Royal London, said:

"The tapering of the annual allowance has caused major problems in the NHS. All year we have been hearing of doctors who are restricting their hours to avoid the risk of large lump sum tax bills.

"The tapered annual allowance is complex and makes it very hard for taxpayers to know where they stand.

"The solution is to abolish the taper outright, even if this means a lower across-the-board annual [pensions] allowance for all.

"What we do not need is another review, however urgent."

Prior to the election, Hancock said talks with the Treasury about abolishing the taper were under way.

An announcement about the taper's future could be contained in a Budget speech, which is widely expected to be delivered in February.

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