The Annual Allowance is the amount you can pay into a pension fund each year and get tax relief. From 6 April 2016, the Annual Allowance will be tapered from £40,000 for those with earnings of £150,000 or less down to £10,000 for those with income of £210,000 or more.
For this purpose, income isn’t just comprised of someone’s salary. It is ‘adjusted’ to ensure it includes personal and employer pension contributions or any other income including savings, bonuses or even an individual’s buy-to-let property rental – taking many more people into a higher earnings bracket. The annual allowance will reduce by £1 for each £2 of adjusted income above £150,000 until it reaches £10,000.
If appropriate, some people if they act now could reduce their tax liability by carrying forward any leftover pension allowance from previous years or taking advantage of the transitional Pension Input Period (PIP) which will provide the opportunity of making a total payment of up to £80,000 into their pension pot this year.

If you would like to seek independent financial advice on what is your annual allowance and how to use it appropriately through out the year, we at Hutt Professional have independent financial advisers with many years of experience and who are highly qualified who would be more than happy to offer you the advice you need. If you are located in Leamington Spa or surrounding areas and wish to seek independent financial advice please do not hesitate to contact us.

 

Source: http://www.goldminemedia.co.uk/  12/04/2016