How much can I contribute to my SIPP?
If you're a UK resident under the age of 75, the general rule is that, each tax year, you can contribute as much to your pensions as you earn. You’ll receive tax relief on your contributions.
For example: If you earn £30,000, you should be able to contribute £30,000 gross to your pension. Of this, £24,000 will be your own money, and the taxman will add basic-rate (20%) tax relief of £6,000.
Higher and top-rate taxpayers can claim back the additional tax they have paid through their tax return.
If you’re a UK resident under the age of 75 and don’t pay tax or have any earnings, you can still contribute up to £3,600, including tax relief, to your pension. This would be £2,880 of your own money, and £720 added by the taxman at basic-rate (20%) tax relief.
A pension annual allowance applies. For most people this is £40,000, but if you have income over £240,000 your annual allowance is tapered down from £40,000 to a minimum of £4,000. Please read our taper relief guide for more information. Once you access your pension, your annual allowance may drop to £4,000. Please see our Money purchase annual allowance information page.
If your total pension contributions – including any contributions your employer makes – exceed your annual allowance, you will be subject to a tax charge, known as the annual allowance charge (AAC). For more information on this charge and how to pay it please read our guide.
Please remember that tax rules can change in the future, and other factors affect how much you can pay into your pension, which you may also need to consider.