24 Jan 2020
For most taxpayers, the maximum pension contribution is £40,000 each tax year, although this depends on their earnings. This limit covers both contributions by the individual and their employer.
Note that the unused allowance for a particular tax year may be carried forward for three years and can be added to the relief for the current tax year, but then lapses if unused.
Hence, the unused pension allowance for 2016/17 will lapse on 5 April 2020 if unused. Note that under the current rules the net after tax cost of saving £10,000 in a personal pension for a higher rate taxpayer is only £6,000.
Our experts at Beavis Morgan can ensure your tax affairs are as efficient as possible to fit your circumstances. In addition, we can look ahead to retirement and inheritance tax planning.
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