Annual allowance question

Fatbritabroad

Very quick query on pension allowance

I get a large bonus shortly which is about 38k gross and intend to put this in my pension

I also as standard contribute about 15k a year to my pension

I'm aware of the 40k limit and the carry forward of unused allowance. my question is simply is that automatic or do I need to declare it somewhere when I do it so they know i haven't breached the limit

zagfles

You don't need to declare you're using carry forwards, just keep records in case HMRC query it. I think pension providers inform HMRC when you exceed the £40k limit in one scheme. But you only need to declare to HMRC if there's actually a charge to pay.

Paul_Herring

https://www.gov.uk/guidance/check-if-you-have-unused-annual-allowances-on-your-pension-savings

Carry forward your unused annual allowance

You can carry forward unused annual allowances from the 3 previous tax years. You do not need to report this to HMRC.

Basically, as zagfiles said, you simply need to keep your own records to make sure you're staying within the rules.

Fatbritabroad

Thanks guys much appreciated

Albermarle

Just be clear that the £40K allowance includes any employer contribution + your contributions + the tax relief .
It does not necessarily mean you can put £40K in directly yourself .

Bravepants

And total contributions in the year, with carry forward, can only be up to your gross earnings in that year.


You can carry forward up to the previous 3 years' worth. But in your case your bonus is earnings, so pretty straightforward!

Fatbritabroad

Thanks both yes thats fine my base earnings are 81k (ex car allowance etc) and everything that goes into my pension is 15k i should say