Carry forward allowance

The annual allowance for most savers is currently £40,000 for each tax year. However, you may be able to contribute up to £160,000 to your pension pot this tax year (until 5th April 2018) and still benefit from tax relief, by ‘carrying forward’ unused annual allowances from up to the previous three tax years. 

To be able to use this you need to: 

  • Have paid in the maximum tax relievable amount to your pension(s)* in the current tax year (from 6 April 2017 to 5 April 2018).
  • Earn at least the amount you want to invest in the tax year you're making the contribution (this would not apply if your employer is making the contribution on your behalf).
  • Have been a member of a UK-registered pension scheme in the relevant tax year from which you want to carry forward.
  • Use any remaining annual allowance from the earliest year first (you can only go back three years).

 * This applies to all pensions you have, including any benefits built up in a salary-related scheme (for example, active defined benefits/final salary schemes) – your provider can give you details. Bear in mind that contributions paid by an employer or on your behalf by someone else also count towards your annual allowance.

Carry forward guide

Read our guide to see if 'carry forward' could apply to you and how to take advantage of this allowance of it does.

The value of investments can go down as well as up, and you may get back less than you invest. The eligibility to invest in a pension depends on individual circumstances and all tax rules may change in the future. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser. You will not normally be able to withdraw money from a pension until you are 55.