Which annual allowance year?

Troxy

Here’s the scenario.
You get paid at the end of March 23 and your employer makes a salary sacrifice contribution to your pension. Due to admin etc. it lands into your pension pot after 5th April.

Which annual allowance year does the pension payment count towards? 2022/23 or 2023/24. I think I know the answer but want to make sure.

mark55man

Hello @Troxy - sorry your post hasn't had an answer.  I'll just bump it up for those more expert than me.

I think the answer varies depending on whether the payment was made before the 5th (but not cleared) or simply not paid until after the 5th.  If the latter I can't see anyway it could be attributed to 22/23. I presume you are aware that you can count back 3 years on annual allowance although you would need enough 23/24 income to take advantage   

zagfles

Pretty sure (but not certain) that it would count in 2023/4. If it was a "net pay" contribution it would be 2022/3, but because it's sal sac, it's an employer contribution and so would probably count when the employer makes the contribution.

But as above carry forwards may be available, so would only be an issue if you've maxed 2022/3 and were wanting to use carry forwards from 2019/20, which you can't use in 2023/4.

Ask the provider for the pension input amounts for the tax years to be sure.

Troxy

Thanks both, concurs with my thoughts. I am looking to max out carry forward hence the question; it’s more for me for next year but want to be prepared.

dunstonh

The employer effectively acts as collection agent for the transmission of employee contributions taken from their pay and passed on to the relevant pension scheme administrator.

The date of payment in the case of a contribution made under the net pay arrangements is the date of deduction from the employee’s pay.

The date of payment for a contribution made under Relief at Source, for example to a group or other personal pension scheme, is the same as a payment the member makes direct. For example the date authorised to draw money by direct debit from the employer’s bank account or the date the employer’s cheque is received.

HMRC PTM041000 - Contributions: essential principles

zagfles

dunstonh said:

The employer effectively acts as collection agent for the transmission of employee contributions taken from their pay and passed on to the relevant pension scheme administrator.

The date of payment in the case of a contribution made under the net pay arrangements is the date of deduction from the employee’s pay.

The date of payment for a contribution made under Relief at Source, for example to a group or other personal pension scheme, is the same as a payment the member makes direct. For example the date authorised to draw money by direct debit from the employer’s bank account or the date the employer’s cheque is received.

HMRC PTM041000 - Contributions: essential principles

That's completely useless, the OP made it clear the contributions are sal sac, ie employer contributions. Not net pay or RAS.