Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings. Any contributions in excess of £40,000, whether personal or by the employer, may be subject to income tax on the individual.
The limit may be reduced to £10,000 once money purchase pensions are accessed.
Where the £40,000 limit is not fully used it may be possible to carry the unused amount forward for three years.
Employers will obtain tax relief on employer contributions if they are paid and made 'wholly and exclusively'. Tax relief for large contributions may be spread over several years.
The annual allowance may be reduced where adjusted income exceeds £150,000. 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.