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Pension premiums
| 2020/21 | |
| Minimum age for taking benefits | 55 |
| Annual allowance * | £40,000 |
| Annual allowance charge on excess | 20-45% |
| Lifetime allowance | £1,073,100 |
| Lifetime allowance charge if excess drawn | 55% if taken as cash lump sum - 25% if taken as income |
| Tapered annual allowance (applies to income over this amount) - amount including pension contributions | £240,000 |
| Normal maximum tax-free lump sum | 25% |
| Money purchase annual allowance | £4,000 |
| Stakeholder/permitted pension contributions regardless of salary | £3,600 (gross) |
* Subject to 50% taper down to £10,000 if threshold income over £200,000 and adjusted income (including employer pension contributions) over £240,000.
Annual pensions allowance
There may be an entitlement to a greater annual pensions allowance if there are unused reliefs from the three earlier tax years, providing you had a pension fund. The unused amount of the annual allowance can be carried forward up to three years and used once the current year annual allowance has been fully utilised.. The relief may, however, be reduced to £4,000 if pension savings have already been accessed.