Annual Allowance, salary cap, SA101

jimmyboy420

Hello,


I am in the fortunate position of having a reasonably large, mainly tax free lump sum coming to me this year (selling of a rental property that was previously my main residence for many years).


I have an earned income from 2 jobs of about £60k.


I have some other income too (another rental property). It is my intention to live off the capital lump sum, and pay the full amount of my earned income into my pension.


I understand I will go over my annual allowance of £40k, but I believe that's OK because I have at least £20k of annual allowance left over from my 2015/16 Pension Input Period.


I have been trying to figure out how I deal with this and I have found the following form: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/690276/sa101-2018.pdf
Box 10 on page 4 (Pension Savings Tax Charges) is entitled:
"Amount saved towards your pension, in the period covered by this tax return, in excess of the Annual Allowance"


In my circumstance this amount would appear to be £20k? But I am not sure if this is the correct way to do it. Do I in fact leave this cell blank because I have the carryforward amount which offsets it?


Thanks,


Jimmy.

Paul_Herring

From: https://www.gov.uk/government/publications/pensions-tax-charges-on-any-excess-over-the-lifetime-allowance-annual-allowance-special-annual-allowance-and-on-unauthorised-payments-hs345-self/hs345-pension-savings-tax-charges-2017#unused-annual-allowance-carry-forward

You don't need to make any claim to HMRC to carry forward unused annual allowance and you don't need to show this on your tax return if your unused annual allowance means that an annual allowance charge isn't due. You do need to have been a member of a registered pension scheme during each of the carry forward years.

jimmyboy420

That's great, thank you.