HMRC update: pension scheme administration
14 February 2023
HM Revenue and Customs (HMRC) has now updated the GOV.UK guidance on the tax years pension scheme members can carry forward an annual allowance.
An annual allowance is the maximum that an individual can save in their pension pots in a tax year (6 April to 5 April) before they have to pay tax. If the members savings go above the annual allowance, a need to pay an annual allowance tax charge may apply. However members may be able increase their annual allowance by carrying forward any unused annual allowance from previous years. An updated list of the tax years can be found here.
Payroll professionals should remember that there is also a cap on the amount of any unused annual allowance that can be carried forward from the pre-alignment tax year, depending on the individual’s circumstances for that ‘mini’ tax year. You can read more detailed guidance on carry forward rules in the pension tax manual.
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information.