How Much Can I Put into My Pension in 24/25? Find out using our Calculator.
With the tax year-end fast approaching, many UK taxpayers are looking to maximise their pension contributions and make the most of tax relief. However, rules around pension allowances, income thresholds, and tapering can be complex.
In this article, we’ll explain how to calculate your Annual Allowance, whether tapering applies, and how to use carry forward to boost your pension savings.
At the end of the article, you’ll find a Pension Allowance Calculator to help you determine your exact contribution limit.
The Pension Annual Allowance
The Annual Allowance is the maximum you can contribute to your pension in a tax year while still receiving tax relief.
For the 2024/25 tax year, the standard Annual Allowance is £60,000. However, your allowance may be reduced if:
- Your income is too high (Tapered Annual Allowance applies).
- You have unused allowances from previous years and want to make additional contributions.
Your total contributions include:
✅ Employer contributions – Payments your employer makes into your pension.
✅ Employee contributions – Contributions deducted from your salary.
✅ Personal contributions – Contributions you make from your own funds to a private pension (e.g., a SIPP).
If you exceed your available Annual Allowance, you may have to pay a tax charge.
Threshold Income and Adjusted Income: Do You Have a Reduced Allowance?
To determine if you are affected by pension tapering, you must calculate two key figures:
1. Threshold Income
Your Threshold Income is your total taxable income, with certain deductions and additions.
How to Calculate Threshold Income
- Start with all taxable income, including:
- Salary, bonuses, and taxable benefits.
- Self-employment or partnership income.
- Rental income.
- Dividends.
- Savings interest and other taxable sources.
- Deduct:
- Any personal pension contributions where tax relief is given at source (e.g., a SIPP contribution).
- Certain allowable tax reliefs (e.g., trade losses, Gift Aid donations).
- Add back:
- Any salary sacrificed for pension contributions (if the arrangement was made after 8 July 2015).
📌 If your Threshold Income is £200,000 or less, your Annual Allowance remains at £60,000.
2. Adjusted Income
Your Adjusted Income includes all taxable income plus employer pension contributions. It does not deduct personal pension contributions.
How to Calculate Adjusted Income
- Start with all taxable income (same as above).
- Add employer pension contributions, including:
- Employer contributions to a workplace pension.
- Any employer contributions made under salary sacrifice.
- The value of benefits built up in a defined benefit (final salary) pension scheme.
📌 If your Adjusted Income is more than £260,000, your Annual Allowance will be tapered.
Tapered Annual Allowance
If your Adjusted Income exceeds £260,000, your Annual Allowance is reduced.
For every £2 of Adjusted Income over £260,000, your Annual Allowance is reduced by £1.
| Adjusted Income | Tapered Annual Allowance |
|---|---|
| £260,000 or less | £60,000 |
| £310,000 | £35,000 |
| £360,000 or more | £10,000 (minimum) |
Example: How Tapering Works
- Adjusted Income = £310,000 (£50,000 over the £260,000 threshold).
- Tapering applies: £50,000 ÷ 2 = £25,000 reduction.
- Annual Allowance = £60,000 - £25,000 = £35,000.
📌 The minimum allowance is £10,000, which applies if Adjusted Income is £360,000 or higher.
Carry Forward: Boosting Your Allowance with Unused Contributions
If you haven’t used your full Annual Allowance in previous years, you may be able to carry forward the unused amount.
How Carry Forward Works
You can use the unused Annual Allowance from the last three tax years.
| Tax Year | Standard Allowance | Minimum (if tapered) |
|---|---|---|
| 2021/22 | £40,000 | £4,000 |
| 2022/23 | £40,000 | £4,000 |
| 2023/24 | £60,000 | £10,000 |
📌 Even if your 2024/25 Annual Allowance is tapered to £10,000, you can still contribute more using Carry Forward.
How Much Can You Contribute Before 5 April 2025?
To determine your maximum pension contribution, follow these steps:
1️⃣ Calculate your Threshold Income (Is it over £200,000?).
2️⃣ Calculate your Adjusted Income (Is it over £260,000?).
3️⃣ Check if tapering applies and determine your Annual Allowance.
4️⃣ Add any unused allowances from the last three years (Carry Forward).
You can use the Pension Allowance Calculator 24/25 below to work out your exact contribution limit.
Current Year (2024/25)
Previous Years
Results
Current Year Analysis
- Threshold Income: £0
- Adjusted Income: £0
- Standard Allowance: £60,000
- Taper Reduction: - £0
- Your Annual Allowance: £60,000
- Total Contributions: £0
- Unused Current Year: £60,000
Summary
- Current Year Allowance: £60,000
- Current Contributions: - £0
- Remaining Available: £60,000
You must use up your current year's allowance before using carried forward allowance from the prior 3 years. Important: Only years in which you were registered with a pension scheme can be used for carry forward. This is a simplified calculation and does not account for all personal circumstances. For personalised advice, consult a financial advisor.
Final Thoughts
Maximising your pension contributions before 5 April 2025 is an effective way to reduce your tax bill and increase your retirement savings.
However, with tapered allowances and complex rules, it’s essential to check how much you can contribute without triggering a tax charge.
Use our Pension Allowance Calculator to find out your exact contribution limit before the tax year ends.
