What is the UK pension annual allowance?

It is the maximum you can pay into pensions each tax year while still getting tax relief, including employer contributions. The standard allowance is 60,000 GBP from 2023-24 onward, replacing the previous 40,000 GBP limit.

When does the tapered annual allowance apply?

The taper applies only if your threshold income exceeds 200,000 GBP AND your adjusted income exceeds 260,000 GBP. For every 2 GBP of adjusted income above 260,000 GBP, your allowance drops by 1 GBP, down to a minimum of 10,000 GBP.

What is the difference between threshold and adjusted income?

Threshold income is broadly your taxable income less personal pension contributions. Adjusted income adds back all pension contributions, including employer ones. Both tests must be met before the taper bites, which protects people whose high income is mostly employer pension funding.

How does carry-forward work?

If you did not use your full allowance in the previous three tax years, you can carry the unused amount forward and add it to this year's allowance, provided you were a pension scheme member in those years. This calculator lets you enter the total unused amount.

What happens if I exceed my allowance?

Contributions above your available allowance trigger an annual allowance charge, effectively clawing back the tax relief at your marginal rate. The tool flags any excess so you can see whether a charge would apply.

UK Pension Annual Allowance Checker

If you save into UK pensions, the annual allowance caps how much you can contribute each tax year with tax relief. High earners face a tapered allowance, and unused allowance can be carried forward from the last three years. This checker combines all three rules.

How it works

The standard allowance is 60,000 GBP. The taper only applies when both income tests are met:

taper applies if  threshold income > 200,000  AND  adjusted income > 260,000
reduction        = (adjusted income − 260,000) / 2
allowance        = max( 10,000 , 60,000 − reduction )   (if taper applies)
allowance        = 60,000                                 (otherwise)
total room       = allowance + carry-forward (last 3 years)
excess           = max( 0 , contributions − total room )

The reduction is 1 GBP of allowance for every 2 GBP of adjusted income over 260,000 GBP, and the allowance never falls below the 10,000 GBP floor (reached at 360,000 GBP of adjusted income).

Example

Adjusted income of 300,000 GBP and threshold income of 250,000 GBP triggers the taper: the reduction is (300,000 − 260,000) / 2 = 20,000 GBP, so the allowance is 40,000 GBP. Add 15,000 GBP of carry-forward and your room is 55,000 GBP. Pay in 60,000 GBP and 5,000 GBP is subject to the annual allowance charge.

Notes

This is a planning estimate. The “money purchase annual allowance” (a separate 4,000 GBP limit triggered by flexibly accessing a pension) is not modelled, and defined-benefit accrual uses a different input-amount calculation. Always confirm figures with your scheme administrator or adviser.