What is pension carry forward?
Pension carry forward lets you exceed your annual allowance (usually £40,000) by dipping into any remaining annual allowance you have from the last three tax years.
To use carry forward, you must have:
- Been a member of a pension scheme during each tax year you want to carry forward from, even if you didn’t make any contributions.
- Used up your full annual allowance in the current tax year.
- Contributed less than your annual allowance in one or more of the last three tax years. (This includes personal and employer contributions.)
- Earnings of at least the amount you’re contributing in that tax year, if you are making personal contributions.
Remember that tax rules and allowances can change in the future, and the amount of tax relief you receive depends on your individual circumstances.