What about your pension payments?

What about your pension payments?

There is no hard and fast limit on how much you can pay into your pension each year – unless you want to benefit from tax reliefs.

If you pay into a personal or stakeholder pension, your annual allowance, which resets every financial year on 6 April, allows you to make pension contributions without paying tax on them.

The current annual tax-free pension allowance for most people is £60,000, so if you’ve paid less than this into your pension, consider contributing more to maximise your tax-free savings.

However, be aware that if you make certain withdrawals from a defined contribution pension pot your allowance may be restricted by the Money Purchase Annual Allowance (MPAA) to future tax-free contributions of just £10,000.

Don’t forget, the Lifetime Pension Allowance has also now been abolished, so you can now put more away throughout your life without being stung by a higher tax bill.

This is a great time to add some more to your pension pot as it won’t carry over into the next financial year.