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How Much can I pay into my Pension per Month

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  • Secret2ndAccount
    Secret2ndAccount Posts: 879 Forumite
    Fifth Anniversary 500 Posts Name Dropper
    edited 22 March 2022 at 6:44PM
    Since you are taking a DB (final salary) pension, you do not trigger the MPAA, so your annual contribution limit is 40k, not 4k.
    So for you personally, the upper restriction will be your salary (pension doesn't count) of 37,500. But that includes the contribution from your employer and the taxman. You can pay in 3/4 x 37,500 = 28,125. The taxman will add the rest.
    27,900 / 12 = 2343/month, minus 170 paid by your employer = 2173/mth

    Actual answer is 2330. See the two posts below
  • Jeremy535897
    Jeremy535897 Posts: 10,745 Forumite
    10,000 Posts Fifth Anniversary Photogenic Name Dropper
    Since you are taking a DB (final salary) pension, you do not trigger the MPAA, so your annual contribution limit is 40k, not 4k.
    So for you personally, the upper restriction will be your salary (pension doesn't count) of 37,500. But that includes the contribution from your employer and the taxman. You can pay in 3/4 x 37,500 = 28,125. The taxman will add the rest.
    27,900 / 12 = 2343/month, minus 170 paid by your employer = 2173/mth
    The fraction is 4/5 rather than 3/4?
  • You are of course correct. Sorry
    37500 x 0.8 = 30000
    30000/12 = 2500
    2500 - 170 = 2330

    1000 apologies. I was staring at it after I posted, saying "something isn't right", but my brain must be having the day off, and I couldn't see it.

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