Putting Money In
Pension arrangements are designed to build up savings for retirement. Pensions are available to everyone (even children and non-earners). Anyone can pay a contribution on behalf of someone else, and you can pay contributions to as many different pension plans as you wish.
You have the flexibility to start, stop, increase or reduce pension contributions whenever you like, although you should speak to your pension provider to check if there any are specific restrictions or limitations.
The personal contributions you make attract tax relief, which is an attractive feature for investors. There are, however, restrictions on the amount of tax relief available. Whilst you can pay an unlimited amount into a pension, there is a limit on the level of contributions which can receive tax relief. This is known as the annual allowance.
Pensions tapered annual allowance restricts pensions tax relief by introducing a tapered reduction in the amount of the annual allowance.
There is a ceiling on how much can be invested tax efficiently in pensions. If you exceed this amount, there are tax penalties when you decide to take money out of your pension. Click here to learn more.
Your annual allowance may reduce when you start taking money out of your pension. Click here to learn more.
There is a ceiling on how much can be invested tax efficiently in pensions. Click here to learn more.
As with any investment, you should always remember that the value of pension savings can go down as well as up, and you may not get back as much as you paid in.
Tax benefits and liabilities depend on individual circumstances and may change in the future.
Taking money from your pension may have an impact on any means-tested state benefits you receive from the Department for Work and Pensions.
The information provided on this website is generic and common across the majority of pension arrangements. However, you should review your Policy Documents to check if other terms and conditions apply.