The 2018 Budget is almost upon us and speculation is mounting about what the chancellor has up his sleeve.
Pensions have been a popular target for cash-strapped chancellors for many years and while no-one expects anything like the seismic changes of the Budget 2014, when 'Freedom and Choice' was introduced, it would be a brave person willing to bet money on there being no change.
For a start, chancellor Philip Hammond needs to think about how he is going to meet his funding commitments to the NHS – we expect a £20bn increase per year by 2023.
We think it likely that Mr Hammond will look to raise money by continuing the time honoured tradition of tinkering with tax relief.
We have already had clear hints that tax relief is high on the government's agenda. Mr Hammond was quoted earlier this month as saying pensions tax relief was "eye wateringly expensive".
In addition, Treasury select committee chairwoman Nicky Morgan said the current tax relief system did not act as an incentive for people to save into a pension.
I think it is a case of not if tax relief is changed, but how.
However, the government has a tricky balancing act in how they go about this. Yes, it is a huge cost to government, but at the same point they must be wary of alienating voters.
It is probably for this reason that the government recently ruled out a move towards a single flat rate of tax relief.
Similarly any proposed caps or removal of the pension commencement lump sum should also be viewed with caution as such a move could seriously undermine the plans put in place by people approaching retirement.
Annual allowance
What seems most likely is that we will see further changes to the annual allowance – the amount you can put into a pension and still receive tax relief.
The annual allowance currently stands at £40,000 per year and has been steadily chipped away at over the years.
As recently as the 2010 to 2011 tax year it stood at £255,000 per year.
Such a change can happen quickly and if an announcement was made in today's (29 October) Budget it could be implemented in time for the next tax year in April.
The same could be said for the tapered annual allowance for high earners. This was introduced in April 2016 and was designed to taper the annual allowance available to those on the highest incomes.
In essence those with total taxable incomes (including employer contributions) of £150,000 or more per year have their annual allowance reduced.
This reduction is at a rate of £1 for every £2 above the £150,000 threshold and is reduced to a floor of £10,000 per year for those earning over £210,000.
