Annual Allowance

The amount of contribution that can be made in any one pension input period (typically a tax year, but can be changed) on which tax relief may be obtained.

For the tax year 2022/23 you can either put 100% of your earnings or £40,000, whichever is lower.

You can put in more than the annual allowance, but any excess will generally be taxed and will not attract tax relief.

Most people will be able to invest as much as they can afford, in order to build up a sufficient pension fund for their retirement.

It is also possible to move money from savings to pension, and benefit from tax relief in the process.

It is also possible to make contributions on behalf of third parties, (such contributions are treated as having come from the member for purposes of tax relief). This offers scope for people to fund their spouses and dependants' pensions, if they so wish. Discuss this with us.

*For pensions provided on a defined benefit basis, the value of benefits accrued each year will be translated into a notional fund, which is then used to assess your position re the annual allowance.