Annual allowance

The annual allowance is set by HMRC. It is the maximum your pension can increase by in a tax year before you receive a tax charge. All your benefits in the fund, and any AVCs and contributions to personal pensions or stakeholder arrangements, are added together each year to work out your pension input amount (PIA). This is tested against the annual allowance for each tax year.

The annual allowance for 2018/2019 tax year is £40,000.

Previous years’ annual allowance limits:

Pension input period                                    Annual allowance

1 April 2011 to 31 March 2012                             £50,000

1 April 2012 to 31 March 2013                            £50,000

1 April 2013 to 31 March 2014                            £50,000

1 April 2014 to 31 March 2015                           £40,000

1 April 2015 to 5 April 2016 £80,000 (transitional rules apply)

6 April 2016 to 5 April 2017 £40,000 (unless tapering applies)

6 April 2017 to 5 April 2018 £40,000 (unless tapering applies)

6 April 2018 to 5 April 2019 £40,000 (unless tapering applies)