Rates & Allowances

Standard Lifetime Allowance

Tax Year	Amount (£)
2006 - 2007	£1,500,000
2007 - 2008	£1,600,000
2008 - 2009	£1,650,000
2009 - 2010	£1,750,000
2010 - 2011 2011 - 2012	£1,800,000 £1,800,000

Member Contributions

There is no limit on the amount that an individual can contribute to a registered pension scheme. If you are a UK resident aged under 75 you may receive tax relief on your contributions to a registered pension scheme. Tax relief is limited to relief on contributions up to the higher of
100% of your UK taxable earnings, and £3,600.

Any amount of contributions paid over the annual allowance will be liable to the annual allowance charge.

Annual Allowance

2006 - 2007	£215,000
2007 - 2008	£225,000
2008 - 2009	£235,000
2009 - 2010	£245,000
2010 - 2011 2011 - 2012	£255,000  £50,000

Notional Earnings Cap

Before 6 April 2006 the rules of many pension schemes limited the amount of benefits that could be provided or contribution paid by reference to the permitted maximum under s590C ICTA 1988. Although section 590C ICTA 1988 was repealed on 6 April 2006 the permitted maximum can continue to apply to registered pension schemes for a period up to 5 April 2011 because of regulation 4 of The Registered Pension Schemes (Modification of the Rules of Existing Schemes) Regulations 2006 – SI 2006/364.

If section 590C had not been repealed on 6 April 2006, a Treasury order would have stated the permitted maximum figure for the tax years as follows;

Tax Year	Amount
2006 - 2007	£108,600
2007 - 2008	£112,800
2008 - 2009	£117,600
2009 - 2010	£123,600
2010 - 2011	£123,600

Tax charges on payments from registered pension schemes

There are a number of special tax charges that apply to special payments made from registered pension schemes. These are listed below. The normal income tax rates apply to ordinary pensions payments made from pension schemes.

Charges	Rates
Lifetime allowance charge	55% - if the amount over the lifetime allowance is paid as a lump sum	25% - if the amount over the lifetime allowance is not taken as a lump sum
Annual allowance charge	40%
Unauthorised payments charge	40%
Unauthorised payments surcharge	15%
Short service refund lump sump charge	20% on first £10,800, 40 % on amounts over £10,800
Special lumps sum death benefits charge	35%
Authorised surplus payments charge	35%