It enacts the 2004 Budget speech made by Chancellor of the Exchequer Gordon Brown to the Parliament of the United Kingdom.

In the UK, the Chancellor delivers an annual Budget speech outlining changes in spending, tax and duty.

[citation needed] The principle of the new regime is that a pension fund will be tax-free provided it is below the life time allowance (which was set at £1.5m for the year from 6 April 2006).

A second restriction was imposed limiting the maximum annual contribution into a pension scheme.

[citation needed] Although the new regime is simpler, the need to provide transitional arrangements for pension scheme members whose existing entitlements exceed the new limits resulted in the actual implementation being extremely complex.

The Finance Act 2004, section 19(1) and Schedule 2, (Appointed Day) Order 2004 (S.I.