Carry foward

Aob

Hello can anyone tell me if I put the maximum from my salery into my pension through salery sacrifice can I then add from my savings taking me way over my current salery, to a pension utilising carry forward firstly is this possible and will I get hmrc top up on all carry forward amount. 

elouise01582

The maximum you are permitted to pay into a pension per tax year is the amount of your salary. This is so that you do not receive tax relief on monies you have not paid tax on.  So the answer to your question is no.

Albermarle

The maximum you are permitted to pay into a pension per tax year is the amount of your salary.

To be extra clear , the maximum includes the tax relief .So if you earn £20K , the max is £20K including tax relief .

Separately although paying pension contributions by salary sacrifice is normally a good thing , you are not allowed to sacrifice so much of your salary that you are paid less than the minimum wage .

Aob

Thank you for the answers so when can you use carry forward and can you get relief on it

AlanP_2

Aob said:

Thank you for the answers so when can you use carry forward and can you get relief on it

In simple terms when your salary is >£40k and you want to pay >£40k (AA limit so need to utilise carry forward) in to a pension. It does get a bit more complicated but that is the essence of it.

Albermarle

If I only added £15K to my pension each of the last three tax years . I would have £75K unused allowance + another £40K for this year , so £115 K in total for this tax year . If say my employer added £5K , then £110 K left .
However to take full advantage of this and get the tax relief , my salary would have to be at least £110K this tax year,
If my salary was £50K then that would be the max amount gross I could add,