There is no financial limit on the amount that may be contributed to a registered pension scheme. The maximum amount on which an individual can claim tax relief in any tax year is the greater of the individual’s UK relevant earnings or £3,600 (gross).
If total pension input exceeds the annual allowance (£40,000) there may be a tax charge on the excess. Where the annual allowance limit is not fully used it may be possible to carry the unused amount forward for three years.
The annual allowance may be reduced where adjusted income exceeds £150,00. A £4,000 limit may apply where money purchase pensions are accessed.
|Maximum age for tax relief||74|
|Minimum age for taking benefits||55|
|Lifetime allowance charge||– lump sum paid||55%|
|– monies retained||25%|
|on cumulative benefits exceeding||£1,030,000*|
*Subject to transitional protection for excess amount.