Tax controls & your pension
This section looks at the HM Revenue and Customs (HMRC) rules that govern pension savings.
There are controls on the total amount of contributions you can make into all pension arrangements and receive tax relief on, and on the pension savings you can have before you become subject to a tax charge. This is in addition to any income tax you pay on your pension once it is in payment.
Most people will be able to save as much as they wish as their pension savings will be less than the allowances.
Are there any limits on how much you can pay in contributions?
At the present time there is no overall limit on the amount of contributions you can pay, although there is a limit of £7,026 on the extra LGPS pension you can buy by payment of Additional Pension Contributions (APCs). Although there is no overall limit on the amount of contributions you can pay to all schemes, tax relief will only be given on contributions up to a total of 100% of your taxable earnings in a tax year (or, if greater, £3,600 to a 'tax relief at source' arrangement, such as a personal pension or stakeholder pension scheme).
What are the tax controls on your pension savings?
There are two controls - the annual allowance and the lifetime allowance. Further information can be found using the links below: