Technical Tuesday is back!

This month we are looking at the Pension Annual Allowance.  If you would like more information, then please do get in touch with our friendly team on 01285 708444 and we will be happy to help!

• Within each tax year 6 April to 5 April the following year you have a limit on the amount you can pay into a pension and tax relief will be applied.
• For 2022/23 the standard allowance is £40,000 gross. However you can only put in 100% of your earnings so if you earn less than this your allowance is reduced to your earnings amount.
• If you earn over £240,000 then your allowance will be reduced on a tapered basis, (look out for next months Technical Tuesday for more information).
• If you are in receipt of pension income then your allowance will also be reduced, (see our Technical Tuesday from 21st June for more information on the Money Purchase Annual Allowance).
• If you have no earnings you can still contribute up to £3,600 gross and receive tax relief at the basic rate (i.e., net contribution of £2,880 with tax relief of £720).
• There is something called Carry Forward relief that may mean, you can contribute more than the standard allowance, (this will depend upon your income though and whether you have any remaining allowances over the last 3 tax years).
• Something to note: when you reach 75 any contribution you make will not receive tax relief.