Pension contributions

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 by £1 for every £2 of adjusted income over £150,000 to a minimum of £10,000.

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 million*
Maximum tax-free lump sum 25%*

*Subject to transitional protection for excess amount.

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Davis Bonley, Northside House, Mount Pleasant, Barnet, Hertfordshire EN4 9EE , Davis Bonley is a trading name of Davis Bonley Limited, Northside House, Mount Pleasant, Barnet, Herts EN4 9EE. Company registration number 08989322. Regulated as auditors and regulated for a range of investment business activities by the Association of Chartered Certified Accountants. Awarded approved employer status for Association of Chartered Certified Accountants trainee and practising certificate development.

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