UK Pension Annual Allowance Calculator

The Annual Allowance (AA) is the maximum amount you can save into pensions each tax year while receiving tax relief. For 2025/26 the standard AA is £60,000. This covers all contributions — personal, employer, and third-party. You can also contribute up to 100% of your UK earnings, whichever is lower.

If your threshold income exceeds £200,000 and your adjusted income exceeds £260,000, your Annual Allowance is reduced by £1 for every £2 of adjusted income above £260,000, down to a minimum of £10,000. Adjusted income includes your gross income plus employer pension contributions.

You can carry forward unused Annual Allowance from the previous 3 tax years. This means if you didn't use your full AA in earlier years, you can make larger contributions now without triggering an Annual Allowance Charge. You must have been a member of a registered pension scheme in each year you carry forward from.

If you have flexibly accessed your defined contribution pension (e.g., taken an uncrystallised funds pension lump sum or started flexi-access drawdown), your Annual Allowance for money purchase contributions is reduced to £10,000. The MPAA cannot be carried forward and you cannot use carry forward from previous years.

Contributions above your Annual Allowance (including any carry forward) are subject to an Annual Allowance Charge. The excess is added to your taxable income and taxed at your marginal rate. You must report this on your Self Assessment tax return. If the charge exceeds £2,000, you may be able to ask your pension scheme to pay it.