Parents across the country could be missing out on a large amount of extra money for their kids.
A financial expert has warned that children could be £720 a year worse off because their parents or guardians have not taken out a pension for them and started contributing. Rowan Harding, financial planner with Path Financial, said thousands of children could be benefiting from £720 a year basic rate tax relief from the Government to put towards retirement if those looking after them take out a junior pension for those aged under 18.
At present, parents or guardians can put in up to £2,880 a year into a junior pension, and the child will receive basic rate tax relief of 20% in additional contributions from the Government, meaning up to £3,600 could be in their pension each year - that’s a £720 a year cash boost for free.
