Is there a Pension Provider that will open a pension with a CarryBack lumpsum contribution ?

robbo87

hugheskevi said:

Carry forward does not enable you to make pension contributions for a previous year, 

Exactly.

And I have not said it does/did.

However one commenter has assumed 'carryforward' to mean that.

Of course it doesn't, and HMRC concurs.

NoMore

robbo87 said:

hugheskevi said:

Carry forward does not enable you to make pension contributions for a previous year, 

Exactly.

And I have not said it does/did.

However one commenter has assumed 'carryforward' to mean that.

Of course it doesn't, and HMRC concurs.

Funny that because (my bolded bits) :

robbo87 said:

I'm looking for a pension provider that will open a basic pension with a lumpsum 'Carryback/Carry forward contribution', which I'm entitled to make for tax year 2019/20.  Such a 'basic pension' could , I suppose, be a stakeholder or something similar. Not Vanguard's  sipp, they only take current taxyear contributions. Any potential providers??  Thanks for any help..

robbo87

GunJack said:

...and your earnings in the current year also need to be big enough  to cover the proposed payment..

This addresses the point of 'carryforward'. It provides for the use of a previously (perhaps partially) unused allowance from a recent previous taxyear in the current tax year.

It is, of course, NOT, as another poster states, " a pension contribution for 2019:20 or 2020:21." made out of year..

However 'Carryforward' INCREASES the tax allowance in the current year, prorata with any unused allowance from the previous 3 taxyears

My original question was: 

Any potential pension providers who will start a basic pension with a carryforward lumpsum (apart from VG)?


Thanks for any help.

Dazed_and_C0nfused

I think you will struggle to find one who won't.  You are completely missing the point here.

robbo87

NoMore said:

Funny that because (my bolded bits) :

robbo87 said:

I'm looking for a pension provider that will open a basic pension with a lumpsum 'Carryback/Carry forward contribution', which I'm entitled to make for tax year 2019/20.  Such a 'basic pension' could , I suppose, be a stakeholder or something similar. Not Vanguard's  sipp, they only take current taxyear contributions. Any potential providers??  Thanks for any help..

The context is Carryforward. 

eg  'Carryback/Carry forward contribution', which I'm entitled to make for tax year 2019/20.

If you didn't understand that then your assumption is credible.

NoMore

You MAY be able to use carry forward for the Annual Allowance, but as multiple posters have tried to explain there are other things that might be preventing you from doing so.

1) You can only contribute up to a max of your earned income for the current tax year to a pension. Carry forward does NOT extend this.

2) In order to make use of carry  forward you must first use all of the current years Annual Allowance of 40k, so have you and your employer combined contributed (or intend to) £40k or more this year to your pension ?

Albermarle

Any potential pension providers who will start a basic pension with a carryforward lumpsum (apart from VG)?

IN actual reality , as far as I know all pension providers will let you contribute as much as you want and give you basic rate tax relief . It is up to you to make sure you contribute within the correct limits , otherwise HMRC will later find out and you will have to unwind the contributions which would be messy.

So for example if you will earn £60K this tax year, and you have unused annual allowance from the previous three years that allowed you to add more than £40K this year.

You could open a new pension and contribute £48K and the provider will add basic rate tax relief of £12K.

They may contact you and remind you the annual allowance is £40K but you just tell them you have unused annual allowance from previous years and sufficient taxable income this year to add £60K .

I do not think any pension provider would have a problem with that.

robbo87

NoMore said:

robbo87 said:

Dazed_and_C0nfused said:

I'm not sure what you are reading on that link but there is nothing whatsoever to suggest you can make a pension contribution for 2019:20 or 2020:21.

Unless you have a TARDIS maybe.

Let me translate for you:

 "unused annual allowance" means 'pension contribution for' year xxxx xx.

If that's too difficult, check dunstonh comment above.

 

Dazed and confused is right, you are not making a contribution for previous years, you can make a contribution for this year. Carry forward MAY extend the amount you can contribute, but its still a contribution for this year and as such any tax relief will be due based on your tax paid this year. It's irrelevant on tax paid in previous years.

I suspect you are running into another problem which means carry forward allowance is not available to you. There are basically two limits to how much you can contribute to a pension:

 1) You can only personally contribute up to your earned income for the year (or £3600 if you are a non taxpayer)

and

 2) The max Pension contribution from all sources (including employer) is 40K p.a. This is known as the Annual Allowance (AA) and can be extended by unused allowance from the previous 3 years.

Note however both rules have to be satisfied, so you may well have unused Allowance of thousands of pounds, generally unless you have the same or more earned income, you can't make use of it.

d&c ignored the carryforward context of the original Q. Within that ignorance, he is of course correct.

I meet criteria 2. 

NoMore

robbo87 said:

NoMore said:

robbo87 said:

Dazed_and_C0nfused said:

I'm not sure what you are reading on that link but there is nothing whatsoever to suggest you can make a pension contribution for 2019:20 or 2020:21.

Unless you have a TARDIS maybe.

Let me translate for you:

 "unused annual allowance" means 'pension contribution for' year xxxx xx.

If that's too difficult, check dunstonh comment above.

 

Dazed and confused is right, you are not making a contribution for previous years, you can make a contribution for this year. Carry forward MAY extend the amount you can contribute, but its still a contribution for this year and as such any tax relief will be due based on your tax paid this year. It's irrelevant on tax paid in previous years.

I suspect you are running into another problem which means carry forward allowance is not available to you. There are basically two limits to how much you can contribute to a pension:

 1) You can only personally contribute up to your earned income for the year (or £3600 if you are a non taxpayer)

and

 2) The max Pension contribution from all sources (including employer) is 40K p.a. This is known as the Annual Allowance (AA) and can be extended by unused allowance from the previous 3 years.

Note however both rules have to be satisfied, so you may well have unused Allowance of thousands of pounds, generally unless you have the same or more earned income, you can't make use of it.

d&c ignored the carryforward context of the original Q. Within that ignorance, he is of course correct.

I meet criteria 2. 

How about criteria 1 ? Both limits have to be satisfied for pension contributions, so you may well have carry forward available but  you may not have enough earned income to take advantage of it.

dunstonh

Any potential pension providers who will start a basic pension with a carryforward lumpsum (apart from VG)?

All providers support carry forward.    You are asking if they support carry back and carry forward.  Carry back was abolished 31st January 2006.

So, no providers will offer what you are after because it was abolished long ago.

Carry forward allows you to utilise unused allowance from the previous three years if you have fully used the allowance this year.  However, the whole contribution is treated as a 21/22 contribution and you have to have their earnings in this tax year to cover the whole contribution (or an employer contribution if not).