Pension planning – access unused 2008/09 tax relief before 5 April 2012

There is now an annual limit of £50,000 on pension contributions that qualify for tax relief. However, you may be able to carry forward unused annual allowances for up to three years to offset against a contribution of more than £50,000 in one tax year, and the amount of the unused annual allowance can then be added to this year's annual allowance.

You must have been a member of a registered pension scheme to have an unused annual allowance to carry forward from an earlier year.

You are able to carry forward unused annual allowance automatically. You do not need to make any claim to HMRC to carry forward unused annual allowance and you do not need to show this on your tax return if your unused annual allowance means that an annual allowance tax charge is not due.

However, the unused allowance is lost if it is not used within three years – and so 5 April 2012 represents the last date on which any unused annual allowance carried forward from 2008 / 2009 can offset against pensions payments and obtain tax relief – so act now to consider making a pension contribution and use it, or lose it!

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