Pension carry forward rules

wakeupalarm

Can you carry forward unused allowance from previous years if you did not have any net relevant earnings in those previous years? Do you get tax relief on the full contribution?

Example
Can you make a pension contribution in the current tax year of £70,000 using the carry forward unused allowance from 2011/12 even though there was no net releveant earnings that year?

2014/15 Net Relevant Earnings £80,000 Pension Contribution ?
2013/14 Net Relevant Earnings £42,000 Pension Contribution £35,000
2012/13 Net Relevant Earnings £45,000 Pension Contribution £40,000
2011/12 Net Relevant Earnings £0 Pension Contribution £3,600

zagfles

Can't see why not - the net relevant earnings is only relevant to the tax relief limit for the current tax year, it's not carried forwards, the AA is.

The only issue is whether you were a member of a pension scheme in the year you're carrying forwards from, clearly you were as you made pension contributions.

Check on the HMRC calculator: http://www.hmrc.gov.uk/tools/pension-allowance/index.htm

sandsy

assuming Zagfles is right....

11/12: allowance:£50000, unused £46400
12/13: allowance £50000, unused £10000
13/14: allowance £50000, unused £15000
14/15: allowance £40000, unused £40000

A gross contribution of £70000 today would use up all of this year's allowance and £30000 of the 11/12 allowance; the rest of that tax year's allowance would then be lost from tomorrow.

jamesd

Yes, you can carry forward provided that you were in a pension scheme. There's no earnings test for carry forward.

wakeupalarm

Thanks everyone, that's cleared it up. :beer:

davide691

Sorry to hijack this thread. Slightly different situation:
2014/15 (when SIPP started) taxable earnings 10k, gross contribution 10k
2015/16 taxable earnings 10.6k, gross contribution 10.6k

Is it right to assume that’s it for contributions for 2015/16: £30k carry forward from 14/15 can’t be used, given insufficient earnings in 15/16?

kidmugsy

davide691 wrote: »

Is it right to assume that’s it for contributions for 2015/16: £30k carry forward from 14/15 can’t be used, given insufficient earnings in 15/16?

Correct. You can save up the unused 14/15 and 15/16 allowances for a future year, but you'll not be able to use them if your earnings in that future year are less than £40k. (Or £30k after the election, presumably.)