I’ve taken this emergency measure to protect my pension ahead of the Budget – and I urge you to do the same. All the experts are terrified… don’t get caught out: RACHEL RICKARD STRAUS

As the Budget on November 26 draws closer, the chorus of financial experts warning us not to act now – based on what we suspect or fear it may contain – grows ever louder.

And in general, they are right.

For example, you could come to regret taking a tax-free lump sum from your pension because you are worried Chancellor Rachel Reeves will change the rules, if she then doesn’t.

But last year, I acted on a hunch ahead of the Budget – which turned out to be wrong – and have absolutely no regrets.

So much so that this year, I’m doing the same again, only I’ve fine-tuned how I go about it.

Just ahead of the Budget, I’m putting a lump sum in my pension to take advantage of the current tax relief rules.

Tax relief, which is designed to encourage us to save for retirement, is almost impossibly generous – and I fear ripe for the chop. Normally, if someone offered you an investment guaranteed to almost triple your money overnight, I’d tell you to run a mile. But pension saving is one surprising exception.

Contributions made into a pension get income tax relief. This means that if you’re a basic-rate taxpayer and put £80 into your pension, it will be topped up to £100 by the taxman. Higher and additional-rate taxpayers need only put £60 and £55 in respectively to get £100.

This takes you back to the position before tax was paid. On top of that, if you save into a workplace pension, you benefit from contributions from your employer as well. If you put in a minimum of 5 per cent, they should put in 3 per cent, but many employers are more generous than this.

And, if your pension is part of a salary sacrifice scheme, you’ll save on National Insurance contributions as well. This scheme allows you to exchange part of your salary for a pension contribution of the same size, resulting in a lower NI bill for you and your employer (which may keep its saving for itself, or share it with you).

Bundle that all together and, for a higher-rate taxpayer, every £60 post tax you put into your pension could be bumped up to £162 if your employer matches your contributions – and that’s before any potential investment returns.

This comes from higher-rate pension tax relief turning £60 into £100, plus a £60 matched employer contribution and for those who can use salary sacrifice, an extra £2 benefit from avoiding 2 per cent higher NI contributions.

Of course, you should have already taken maximum advantage of employer contributions. But even if you have done that, £60 after tax paid into a pension is turned into £102.

When you eventually take money out of your pension, you will pay income tax on it. But most higher- rate taxpayers become basic-rate in retirement so they benefit from a 40 per cent tax break when they put money in and pay only 20 per cent when they take it out. Financial experts are warning this generous tax perk could be under threat in next month’s Budget – and it’s no wonder.

When other tax breaks to encourage saving and investing are being slashed or eroded away, the generosity of pension tax relief looks increasingly exposed.

The amount of capital gains you can earn in a single tax year has been slashed to £3,000 from £12,300 just a couple years ago.

The Isa allowance has been stuck for eight years. Had it risen in line with inflation, it would be £26,300 today. The personal savings allowance that allows basic rate taxpayers to earn £1,000 of interest tax-free has not risen since it was introduced in 2016. If it had, it would now be worth closer to £1,380 a year.

No wonder so many believe it’s only a matter of time until pension tax relief suffers a similar fate, especially as it ‘costs’ the Government around £50billion a year. Of course, the Chancellor may leave it untouched. I’ve reported on Budget statements for more than 15 years and, every time, financial experts raise the possibility that pension tax relief will be meddled with. And yet it has never happened.

Many a Chancellor has considered it and then backed down when they realise the complexity involved and how much they would upset higher earners in the public sector, particularly, such as some doctors.

I’m willing to take the risk and put a lump sum in my pension now because, really, it’s win-win.

If the rules change, I’ll be grateful I took advantage of the current generosity while I could. And if they don’t, I’m unlikely to regret topping up my pension as the earlier you put retirement money aside, the longer you have for it to grow. You just have to be sure that you won’t need the money sooner.

But this time I’m taking a different approach, having come unstuck last year.

Last time, I contacted my pension provider and asked to put a lump sum into my workplace pension. That bit was straightforward and I received basic rate tax relief automatically.

As I’m fortunate enough to be a higher-rate taxpayer, I had two options: either claim back the 20 per cent additional tax relief if I file a tax return (I don’t) or apply for it through HMRC’s website, which is the option I went for.

The form was not straightforward. HMRC are notoriously hard to get hold of on the phone to check everything is filled out correctly and, months later, I’ve still to receive the tax I’m owed. So this time, instead of a lump sum, I’ve whacked my monthly contributions right up by that amount.

That way, my extra pension contribution will be taken from my salary as usual, with no form-filling or waiting required. The advantage of this is that the tax relief is applied at the correct level automatically, cutting out the HMRC faff.

And because I’m doing it through my salary, I save on NI through the salary sacrifice scheme my employer offers. If you have a sum you can do without until retirement, a pension contribution now may be worth considering.

The rules may not change, so you need to be comfortable doing it whether they do or don’t.

About 12 years ago, a former colleague was so convinced pension tax relief would be cut back he diverted all his household savings – including those of his children – into his pension so he could take advantage of it. No doubt he’s ended up with a very good rate of return on that cash, but his dash to beat the deadline looks comically unnecessary now. And I hope he had no regrets throughout his children’s expensive university years.

There are some limits to how much you can put in, so you should check with your pension provider or financial adviser before going ahead.

If you’re a basic-rate taxpayer, however, you may want to wait until after the Budget.

It is unlikely Ms Reeves would scrap tax relief altogether – although former chancellor George Osborne recently revealed he considered it when he was at the helm of the Treasury.

It is more likely that the current system would be replaced with a flat rate. Perhaps all savers would get 20 per cent tax relief – regardless of income tax bracket. Or the flat rate could be a higher – 25 or 30 per cent, for example. In this case, higher and additional-rate taxpayers would be worse off – but basic-rate taxpayers would be better off under the new rules.

As I’m mitigating against future regrets, there are two more steps I’m taking. Firstly, I’ve made sure I’m happy with where my lump sum will go. Last year’s was invested in a global basket of companies that has returned around 18 per cent. I was lucky. This time, I am diversifying a little, as the last thing I’d want is to invest a lump sum just before a stock market fall.

And, secondly, I’m setting a reminder for myself on my calendar for next month, otherwise, I’ll accidentally pay a huge chunk of my salary into my pension two months in a row, which I can’t afford: do not forget to slash your monthly contributions back down again.