Chartered Management Accountants | Milton Keynes

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Pension Premiums

Pension premiums

Minimum age for taking benefits 55
Annual allowance * £40,000
Annual allowance charge on excess 20%-45%
Lifetime allowance £1.055 million
Lifetime allowance charge if excess drawn * as cash 55% – if income 25%
Tapered annual allowance (applies to income over this amount) – amount including pension contributions £150,000
Normal maximum tax-free lump sum 25%
Money purchase annual allowance £4,000
Stakeholder/permitted pension contributions regardless of salary £3,600

* Subject to 50% taper down to £10,000 if threshold income over £110,000 and adjusted income (including employer pension contributions) over £150,000.

Annual allowance

There may be an entitlement to a greater allowance if there are unused reliefs from the 3 earlier tax years. The relief may however be reduced to £4,000 if pension savings are accessed in the tax year.

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