Pension premiums

There is no limit on the amount that may be contributed to a registered pension scheme. The maximum amount on which an individual can claim tax relief in any tax year is the greater of the individual's UK relevant earnings or £3,600.

If total pension input exceeds the annual allowance of £245,000 there is a tax charge at 40% on the excess. This limit does not apply in the year that full pension benefits are taken.

2010 and beyond

The annual allowance and lifetime allowances already announced up to 5 April 2016.

Budget 2009

Measures introduced in the budget will have an impact on the availability of tax relief for individuals with an income of £150,000 or more, change:

• The pattern of normal regular pension contributions; or
• The normal way in which pension contributions are accrued; and
• Total pension contributions / benefits accrued (pension savings) exceed £20,000 a year

In these circumstances please contact us for advice.

Notes

1. Transitional reliefs are available to protect pension rights built up before 6 April 2006 by registering and protecting those rights, including lump sum rights in excess of £375,000. A claim for this transitional relief must have been made by 5 April 2009. Certain pre-existing lump sum rights of more than 25% are automatically protected.
2. The annual allowance and lifetime allowance are to be frozen for a five year period from 6 April 2010.