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Warning on pension contributions

The annual allowance on pension contributions reduces to £40,000 from the tax year 2014/15 onwards.  However, this may have an impact from an earlier date.


The issue is that pension contributions are based on pension input periods.  If the input period ends in 2014/15, the £40,000 limit applies.  The pension input period does not have to match the tax year.  This means that any pension savings for pension input periods starting before 6 April 2014 (which could be as early as 7 April 2013), but ending in tax year 2014/15, will count towards the reduced annual allowance of £40,000.


You may therefore want to check what your pension input period is and when you will start to be affected by the reduced £40,000 annual allowance.
 

 

 

Date: 29th May, 2013
Author: Cathy Corns

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