Pension Query inc 'Carry Forward' allowance

[Whatsmyname]

Hi guys, I previously sought advice re pension payments and received some good info, I've been thinking about some other things to boost the pension more and would like some feedback if possible,

Figures rounded,

I am maxing out contributions at £40k which uses up £32k of salary, to make things simple lets say I haven't paid anything in for the last 3 years so I believe I am entitled to another £40k for each of those years,

Can I contribute £80k into the scheme for the next 3 years? Is that ok and I will receive all the benefits as per normal? So just pay £64k from salary for 3 years and jobs a good un?

Thanks,

[Mr Pointy]

Hl have a fact sheet on this subject:
https://www.hl.co.uk/pensions/contributions/carry-...

Be aware of the tapered annual allowance:
https://www.hl.co.uk/annual-allowance

The allowance you can target is:
2016/17 £40,000
2017/18 £40,000
2018/19 £40,000
2019/20 £40,000

So this year you could contribute 2019/20 + 2016/17 = £80k
Next year you could contribute 2020/21 + 2017/18 = £80k
The year after you could contribute 2021/22 + 2018/19 = £80k

I think!

Note you need to have earned at least £80k in each year - you can't contribute more than you earn.

[Whatsmyname]

But if you are receipt of the tax benefits then you only need to contribute £64k in order to have £80k paid in?

[Stay in Bed Instead]

Whatsmyname said:

But if you are receipt of the tax benefits then you only need to contribute £64k in order to have £80k paid in?

Correct if you are making personal contributions.

You need £80,000 relevant earnings for each tax year to obtain tax relief on it all though.

[Mr Pointy]

Stay in Bed Instead said:

Whatsmyname said:

But if you are receipt of the tax benefits then you only need to contribute £64k in order to have £80k paid in?

Correct if you are making personal contributions.

You need £80,000 relevant earnings for each tax year to obtain tax relief on it all though.

Presumably you'd be a Higer Rate taxpayer as well so would reclaim the other 20% through your tax return.

[98elise]

Whatsmyname said:

Hi guys, I previously sought advice re pension payments and received some good info, I've been thinking about some other things to boost the pension more and would like some feedback if possible,

Figures rounded,

I am maxing out contributions at £40k which uses up £32k of salary, to make things simple lets say I haven't paid anything in for the last 3 years so I believe I am entitled to another £40k for each of those years,

Can I contribute £80k into the scheme for the next 3 years? Is that ok and I will receive all the benefits as per normal? So just pay £64k from salary for 3 years and jobs a good un?

Thanks,

I assume you mean 80k for 3 years including this year, as you've already said you're maxing out this year's?

If so, then basically yes, with some restrictions/qualification as others have pointed out.

I did the same a few years ago as I'm aiming to retire next year.

[Jockman]

Keep your eye on threshold income at £110k.