For most taxpayers the maximum pension contribution is £40,000 each tax year, although this depends on their earnings. This limit covers both contributions by the individual and their employer.

Note that the unused allowance for a particular tax year may be carried forward for three years and can be added to the relief for the current tax year, but then lapses if unused.  Hence the unused pension allowance for 2016/17 will lapse on 5 April 2020 if unused.

Remember that saving £10,000 in a personal pension for a higher rate taxpayer costs only £6,000 due to the full tax relief on qualifying pension contributions.

As with all of our tax tips and web pages this information is necessarily summarised and of a general nature.  If you would like detailed specific advice please contact us.