Pension annual allowance

cb4fwh

Hi,

I am currently trying to work out the implications of my ongoing overpayments into my company pension scheme, and can't quite get my head around unused annual allowances! Any help is appreciated :-)

I used the government calculator, which told me the following;

Pension Contributions		Available Annual Allowance	Unused Annual Allowance
10/11	£504.00	£50,000.00	£49,496.00
11/12	£14,550.10	£99,496.00	£84,946.00
12/13	£11,270.40	£134,946.00	£123,676.00
13/14	£7,209.00	£173,676.00	£116,971.00
14/15	£5,475.00	£156,971.00	£116,046.00
15/16	£1,800.00	£196,046.00	£156,046.00
15/16	£5,400.00	£156,046.00	£111,916.00
16/17	£4,500.00	£151,916.00	£104,625.00
17/18	£4,500.00	£144,625.00	£105,600.00
18/19	£4,500.00	£145,600.00	£106,500.00
19/20	£4,500.00	£146,500.00	£106,500.00
20/21	£4,500.00	£146,500.00	£106,500.00
21/22	£36,666.63	£146,500.00	£74,334.00
22/23	£47,361.33	£114,334.00	£38,834.00

What I am trying to understand is how much I can contribute in 23/24 without incurring the pension annual allowance tax charge.

I have no plans to contribute any more in 22/23. These figures include both employee and company contributions. My salary is for 22/23 is £90000 (including bonus).  Company contributions for 22/23 are £9700.00 (12%). My employee contributions are made up of 8% contributions, with the rest being additional voluntary contributions.

My projected salary for 23/24 is £104000. I do not plan on making any additional voluntary contributions beyond 23/24.

Any guidance appreciated!

Thanks.

cb4fwh

I forgot to add, my employer does offer salary sacrifice…

Dazed_and_C0nfused

cb4fwh said:

I forgot to add, my employer does offer salary sacrifice…

Is there are reason you haven't opted to use that option then?

GrubbyGirl_2

I'm no expert and I'm already drawing my pension so am not up to date, but it's my understanding that you can only roll forward any unused portions of the £40k annual allowance from the previous 3 years (or is it 2 and the current year is the 3rd year?).  More expert people will advise

cb4fwh

Dazed_and_C0nfused said:

cb4fwh said:

I forgot to add, my employer does offer salary sacrifice…

Is there are reason you haven't opted to use that option then?

I do use it.

Dazed_and_C0nfused

In your original post you said this though,

These figures include both employee and company contributions.

So what contributions have you actually made?

Salary sacrifice means you give up some pay in return for additional employer contributions, that's why you don't get any pension tax relief added to them as employer contributions don't qualify for tax relief.

cb4fwh

GrubbyGirl_2 said:

I'm no expert and I'm already drawing my pension so am not up to date, but it's my understanding that you can only roll forward any unused portions of the £40k annual allowance from the previous 3 years (or is it 2 and the current year is the 3rd year?).  More expert people will advise

Thanks :-) My understanding is that it is the current year, plus any unused from the previous 3 financial years. So for the FY22/23, I would be able to use unused allowances from 21/22, 20/21 & 19/20.

Grumpy_chap

cb4fwh said:

Pension Contributions		Available Annual Allowance	Unused Annual Allowance
10/11	£504.00	£50,000.00	£49,496.00

The initial annual allowance is £40k per year (employer plus employee contributions).
Does that starting "Available Annual Allowance" include some carry-forward?

EDIT - please ignore what I said @troxy has clarified in the following post.

Troxy

Grumpy_chap said:

cb4fwh said:

Pension Contributions		Available Annual Allowance	Unused Annual Allowance
10/11	£504.00	£50,000.00	£49,496.00

The initial annual allowance is £40k per year (employer plus employee contributions).
Does that starting "Available Annual Allowance" include some carry-forward?

No, the annual allowance was higher back then. See link

https://www.gov.uk/government/publications/rates-and-allowances-pension-schemes/pension-schemes-rates

Grumpy_chap

Troxy said:

Grumpy_chap said:

cb4fwh said:

Pension Contributions		Available Annual Allowance	Unused Annual Allowance
10/11	£504.00	£50,000.00	£49,496.00

The initial annual allowance is £40k per year (employer plus employee contributions).
Does that starting "Available Annual Allowance" include some carry-forward?

No, the annual allowance was higher back then. See link

https://www.gov.uk/government/publications/rates-and-allowances-pension-schemes/pension-schemes-rates

Thank you - I apologise for posting incorrect information.  I will edit my post to avoid further confusion.
I was not aware the AA changed in that way - I suppose it changed when the LTA reduced...

cb4fwh

Dazed_and_C0nfused said:

In your original post you said this though,

These figures include both employee and company contributions.

So what contributions have you actually made?

Salary sacrifice means you give up some pay in return for additional employer contributions, that's why you don't get any pension tax relief added to them as employer contributions don't qualify for tax relief.

Ah, apologies. That is my misunderstanding. The contributions have all been personal contributions via AVC.