Is private pension taxed twice?

mjkoll

Hi all- Have a question that I haven't seen addressed anywhere I've looked. . .
I know that if I make contributions to my private/company pension in excess of my annual allowance I will owe income tax immediately on the amount over the allowance. This money, that has had tax paid on it, remains in my pension until I take an income.

The question I have is whether or not this portion of the pot that has already had tax paid on it will be taxed again as income when I take it out (ie- taxed twice)? Thanks in advance for you kind consideration and response.
Best,
Tx Mike

molerat

Yes it will, subject to the usual 25% tax free on the way out. Probably best to find a better vehicle if you want to put more away, S&S ISA or such like, taxed income going in but not taxed on the way out.

zagfles

Yes. That's the point of the annual allowance - to discourage you to exceed it. If you exceed the LTA as well it might get taxed 3 times.

To expand - there's no separation of funds paid in in excess of the AA , so it's just like any other money in the pension. Normal rules apply to withdrawal.

mjkoll

Thanks for the quick replies. Thought that might be the case but sought confirmation.