Pension carry forward rule

IamWood

Hello all,

To put it plainly, how many years can I carry my pension contributions forward for the tax year 2022/2023?

From the tax year 2019/2020?

For my personal situation, I made a contribution of £80K in the tax year 2020/2021, then £40K for the tax year 2021/2022 through salary sacrifice. Do I have anything to carry forward at all for the tax year 2022/2023 (or how much I can contribute for 2022/2023)?

Thanks

Dazed_and_C0nfused

The earliest you could go back to is 2019:20.

But you will likely need to review further back than that to establish of any of your 2019:20 annual allowance was used in 2020:21.

IamWood

Dazed_and_C0nfused said:

The earliest you could go back to is 2019:20.

But you will likely need to review further back than that to establish of any of your 2019:20 annual allowance was used in 2020:21.

Thanks. Let's say I made a contribution of £15K in 2017/2018 and £10K in 2018/2019. How much can I contribute for 2022/2023?

The rule is confusing to me.

Universidad

The annual allowance calculator here can help figure that out:

https://www.tax.service.gov.uk/pension-annual-allowance-calculator

IamWood

How we worked out your results

These results are based on the answers you have provided at the time of this calculation.

Any unused allowances are carried over for up to 3 years.

---

6 April 2022 to 5 April 2023   

Your result	Amount
Available annual allowance	£70,000
Available money purchase annual allowance	£0
Pension savings	£70,000
Amount on which tax is due	£0
Unused annual allowance	£0

---

6 April 2021 to 5 April 2022

Your result	Amount
Available annual allowance	£90,000
Available money purchase annual allowance	£0
Pension savings	£40,000
Amount on which tax is due	£0
Unused annual allowance	£30,000

---

6 April 2020 to 5 April 2021

Your result	Amount
Available annual allowance	£130,000
Available money purchase annual allowance	£0
Pension savings	£80,000
Amount on which tax is due	£0
Unused annual allowance	£50,000

---

6 April 2019 to 5 April 2020

Your result	Amount
Available annual allowance	£130,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£90,000

---

6 April 2018 to 5 April 2019

Your result	Amount
Available annual allowance	£130,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£90,000

---

6 April 2017 to 5 April 2018

Your result	Amount
Available annual allowance	£130,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£90,000

---

6 April 2016 to 5 April 2017

Your result	Amount
Available annual allowance	£140,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£90,000

---

9 July 2015 to 5 April 2016

Your result	Amount
Available annual allowance	£150,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£100,000

---

6 April 2015 to 8 July 2015

Your result	Amount
Available annual allowance	£190,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£150,000

---

6 April 2014 to 5 April 2015

Your result	Amount
Available annual allowance	£160,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£110,000

---

6 April 2013 to 5 April 2014

Your result	Amount
Available annual allowance	£170,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£120,000

---

6 April 2012 to 5 April 2013

Your result	Amount
Available annual allowance	£130,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£120,000

---

6 April 2011 to 5 April 2012

Your result	Amount
Available annual allowance	£90,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£80,000

---

6 April 2010 to 5 April 2011

Your result	Amount
Available annual allowance	£50,000
Available money purchase annual allowance	£0
Pension savings	£10,000
Amount on which tax is due	£0
Unused annual allowance	£40,000

Interesting, Looks like I can contribute about £70 for 2022/2023. 

Does it sound right?

Thanks

Grumpy_chap

IamWood said:

Hello all,

To put it plainly, how many years can I carry my pension contributions forward for the tax year 2022/2023?

From the tax year 2019/2020?

For my personal situation, I made a contribution of £80K in the tax year 2020/2021, then £40K for the tax year 2021/2022 through salary sacrifice. Do I have anything to carry forward at all for the tax year 2022/2023 (or how much I can contribute for 2022/2023)?

Thanks

For the current tax year (2022-23) you have an allowance of £40k plus can use unused allowance from the previous three tax years:
2019 - 20
2020 - 21
2021 - 22

Any contributions made in the current tax year will use this year's allowance first.  If that allowance (£40k) is exceeded, the carry-forward will be used from the oldest available tax year first.

For 2021 - 22, your contribution of £40k used all of that year's allowance but nothing of any carry-forward.

In 2020 - 21, you made contributions of £80k.  That used all the £40k available for that tax year and will have used £40k of carry-forward from the tax years:
2017 - 18
2018 - 19
2019 - 20
The £40k carry-forward will have used remaining available allowance from 2017 - 18 first, then 2018 - 19.  If the carry-forward from those two-years covered the £40k (to bring you to the total of £80k) in 2020-21, then you still have remaining carry forward (could be as much as £40k) from 2019 - 20 that can be used this year.

It is possible that 2022-23 would still have up to £40k carry forward available (plus the £40 current year AA).

What were your contributions for each year since 2017 - 2018?

You can never make contributions exceeding earned income but employer contributions cane exceed earned income.  Employer contributions include those by SS.

You needed to be a member of a pension scheme for any years that you are using carry-forward.

IamWood

Thanks to @Grumpy_chap

This is helpful.

> What were your contributions for each year since 2017 - 2018?
I made a contribution of about £10K for 2017/2018.

Albermarle

nteresting, Looks like I can contribute about £70 for 2022/2023. 

As Grumpy chap mentions, you would need a high enough salary this tax year to take advantage of the carry over.

IamWood

Albermarle said:

nteresting, Looks like I can contribute about £70 for 2022/2023. 

As Grumpy chap mentions, you would need a high enough salary this tax year to take advantage of the carry over.

Thanks. I am aware of that. The carry forward is for part of my bonus

Grumpy_chap

IamWood said:

Thanks. Let's say I made a contribution of £15K in 2017/2018 and £10K in 2018/2019. How much can I contribute for 2022/2023?

The rule is confusing to me.

IamWood said:

Thanks to @Grumpy_chap

This is helpful.

> What were your contributions for each year since 2017 - 2018?
I made a contribution of about £10K for 2017/2018.

Do you know whether you made £10k or £15k contributions in 2017-18?
Contributions is the total of personal and employer contributions.

IamWood said:

Interesting, Looks like I can contribute about £70 for 2022/2023. 

Does it sound right?

I'm really sorry but I could not follow the outputs from the HMRC page that you posted.
Looking at the simple text of what has been mentioned in this thread, the situation is as follows:



Did you make any contributions in the year 2019 - 20?

If the table above is correct, then for 2022-23, you could make £80k contributions. 
That is all of the current year allowance (£40k) plus the full carry forward from 2019 - 20 when no contributions are listed, another £40k.

If the second reference to the £10k for 2017/2018 actually meant to be referring to tax year 2019-20, then the available carry forward will be £30k, so the £70k you mention for this tax year would be correct.

If you make contributions of £40k or more this tax year, then next tax year will not have any carry-forward available so contributions will be limited to £40k.

Your contributions are limited by your earnings, but employer contributions can be higher than earnings.

Hope that helps.

IamWood

Thanks to @Grumpy_chap. This is very helpful.

> Did you make any contributions in the year 2019 - 20?
I made roughly about 10K contributions in 2019-20.