Pension Annual Allowance Calculator UK
How this calculator works
Applies the 2026/27 £60,000 annual allowance, high-income taper and £10,000 minimum. Personal contributions must be entered gross, including relief at source. MPAA cases compare the normal annual-allowance method with the MPAA and reduced alternative-allowance method.
Use the Pension Annual Allowance Calculator to estimate how much pension saving counts towards your 2026/27 allowance. It combines personal contributions, employer contributions, an indicative defined benefit input and unused allowance from earlier tax years.
The standard pension annual allowance is £60,000 for 2026/27, but a lower limit can apply to high earners and people who have flexibly accessed defined contribution pensions. Current rules are established in pension tax legislation and administered by HM Revenue and Customs.
What is the pension annual allowance?
The annual allowance limits the amount of tax-advantaged pension saving that can build up across all of an individual’s registered pension schemes during a tax year.
For 2026/27, the standard annual allowance is £60,000. Pension input above the available allowance can create an annual allowance tax charge unless sufficient unused allowance can be carried forward.
The annual allowance applies to pension input rather than only the amount personally paid by the individual. Employer contributions and increases in defined benefit pension rights can also count.
How does the Annual Allowance Calculator work?
The calculator adds the pension inputs entered, determines the applicable annual allowance and compares the total with current and carried-forward allowance.
The calculator asks for information including:
- annual salary
- personal pension contributions
- employer pension contributions
- an annual defined benefit pension increase where relevant
- unused allowance from earlier tax years
- the tax year being calculated
It can then estimate total pension input, current allowance, available carry forward, remaining allowance and any amount potentially exposed to an annual allowance charge.
The calculation is most reliable where the figures entered are gross pension input amounts supplied or confirmed by the pension providers.
What are the key annual allowance figures for 2026/27?
The standard annual allowance is £60,000, the minimum tapered allowance is £10,000 and the money purchase annual allowance is £10,000.
| Rule | 2026/27 amount |
|---|---|
| Standard annual allowance | £60,000 |
| Threshold income limit for taper testing | £200,000 |
| Adjusted income taper threshold | £260,000 |
| Minimum tapered annual allowance | £10,000 |
| Money purchase annual allowance | £10,000 |
| Carry-forward period | Previous three tax years |
These limits apply to the annual allowance calculation and should not be confused with the separate limits on tax-free pension lump sums.
What counts towards the annual allowance?
Personal and employer defined contribution payments and the calculated growth in defined benefit rights can all count towards the annual allowance.
For a defined contribution pension, the pension input amount generally includes:
- the gross value of personal contributions
- basic-rate tax relief added under relief at source
- employer contributions
- salary sacrifice pension contributions paid by the employer
- contributions paid by another person for the member
A personal payment of £8,000 into a relief-at-source pension is normally grossed up to £10,000 after the provider claims £2,000 of basic-rate relief. The £10,000 gross amount counts towards the annual allowance.
Transfers between registered pension schemes do not normally count as new pension input, although contributions made before the transfer remain relevant.
How are defined benefit pensions measured?
Defined benefit pension input is based on the increase in the value of promised pension rights during the tax year, not the employee and employer contributions paid.
The statutory calculation broadly compares the closing value of accrued benefits with an inflation-adjusted opening value. The increase in annual pension is generally multiplied by 16, with changes in any separate automatic lump-sum entitlement also included.
The calculator’s defined benefit annual increase field provides a simplified estimate by multiplying the amount entered by 16. This may not reproduce the statutory calculation because it does not by itself establish:
- the opening accrued pension
- the permitted inflation adjustment
- the closing accrued pension
- changes to an automatic lump sum
- negative growth or scheme-specific benefit adjustments
Defined benefit members should use the pension input amount supplied by their scheme wherever possible rather than relying solely on a year-to-year pension increase.
How does the tapered annual allowance work?
The annual allowance is tapered only where threshold income exceeds £200,000 and adjusted income exceeds £260,000.
Where both tests are met, the £60,000 standard allowance is reduced by £1 for every £2 of adjusted income above £260,000. The allowance cannot be reduced below £10,000 for 2026/27.
| Adjusted income | Reduction from £60,000 | Indicative tapered allowance |
|---|---|---|
| £260,000 or less | £0 | £60,000 |
| £280,000 | £10,000 | £50,000 |
| £300,000 | £20,000 | £40,000 |
| £340,000 | £40,000 | £20,000 |
| £360,000 or more | At least £50,000 | £10,000 minimum |
If threshold income is £200,000 or less, the tapered annual allowance does not apply even where adjusted income exceeds £260,000.
HMRC explains the current tests in its tapered annual allowance guidance.
What are threshold income and adjusted income?
Threshold income and adjusted income are statutory calculations based on taxable income and pension saving, not simply figures copied from salary or a payslip.
Threshold income broadly starts with taxable income and makes specified adjustments, including for certain pension contributions. Adjusted income broadly adds employer pension input and other pension savings to the relevant income calculation.
Salary sacrifice arrangements created or changed to avoid tapering can be subject to anti-avoidance treatment. Dividends, rental profits, savings interest, bonuses and other taxable income may also affect the calculations.
Because the calculator asks for annual salary rather than a complete breakdown of taxable income, its taper result may be incomplete where the user has substantial non-salary income or complex pension arrangements.
How does pension carry forward work?
Carry forward can use available unused annual allowance from the previous three tax years after the current year’s allowance has been used.
For a 2026/27 calculation, the potentially relevant carry-forward years are:
| Order | Tax year |
|---|---|
| Oldest available year used first | 2023/24 |
| Second available year | 2024/25 |
| Most recent earlier year | 2025/26 |
The individual must have been a member of a registered pension scheme during a year from which unused allowance is carried forward. They did not necessarily need to have contributed during that year.
Unused allowance is calculated using the annual allowance that actually applied in each earlier year. If the tapered annual allowance applied, the unused amount is based on that lower allowance rather than the standard £60,000.
Carry forward is automatic and does not require a separate claim. Records should nevertheless be retained to support the calculation if HMRC asks for evidence.
Illustrative annual allowance calculation
In this illustrative example, £85,000 of pension input is covered by the £60,000 current allowance and £25,000 of carry forward, leaving £5,000 available.
Illustrative assumptions: the calculation is for 2026/27; the individual earns £80,000; the tapered allowance and money purchase annual allowance do not apply; personal gross pension contributions are £40,000; employer contributions are £45,000; there is no defined benefit input; and the individual was a registered pension-scheme member in each carry-forward year.
| Calculation stage | Amount |
|---|---|
| Gross personal contributions | £40,000 |
| Employer contributions | £45,000 |
| Total 2026/27 pension input | £85,000 |
| 2026/27 standard annual allowance | £60,000 |
| Unused allowance from 2023/24 | £15,000 |
| Unused allowance from 2024/25 | £10,000 |
| Unused allowance from 2025/26 | £5,000 |
| Total available allowance | £90,000 |
| Unused allowance remaining | £5,000 |
| Potential annual allowance excess | £0 |
The current £60,000 allowance is used first. The next £25,000 is covered by unused allowance, starting with the oldest available year. The remaining £5,000 from 2025/26 would cease to be available after 2026/27 if it is not used.
This example addresses the annual allowance only. The tax relief available on the personal contribution remains subject to the separate relevant UK earnings rules.
What is the money purchase annual allowance?
The money purchase annual allowance can restrict tax-advantaged defined contribution pension input to £10,000 after specified flexible access to pension benefits.
Events that can trigger the money purchase annual allowance include taking an uncrystallised funds pension lump sum or drawing taxable income flexibly from a flexi-access drawdown arrangement.
Actions that do not necessarily trigger it include taking only a pension commencement lump sum without flexible taxable income or buying certain lifetime annuities. The precise access event should be checked with the pension provider.
Unused annual allowance cannot be carried forward to increase the £10,000 money purchase limit. A person with defined benefit accrual may also have a separate alternative annual allowance for non-money-purchase input.
The calculator does not present a dedicated money purchase annual allowance input, so a user who has flexibly accessed benefits should not rely on the standard result without a separate MPAA calculation.
Is the annual allowance the same as the tax relief limit?
No. The annual allowance and the limit on tax relief for personal pension contributions are separate restrictions.
An individual can generally receive tax relief on personal contributions up to 100% of relevant UK earnings for the tax year, subject to the other pension tax rules. A person with little or no relevant earnings can usually receive relief on gross contributions of up to £3,600.
Employer contributions are not restricted by the employee’s relevant earnings, although they count towards the annual allowance and must meet the applicable employer tax-relief rules.
Carry forward increases the available annual allowance but does not carry forward unused relevant earnings. Someone making a large personal contribution must therefore satisfy both sets of rules.
How is the annual allowance tax charge calculated?
The pension input above the available annual allowance is added to taxable income and charged at the Income Tax rates that apply to that slice of income.
The excess is not simply taxed at a fixed pension rate. It can fall across more than one Income Tax band, and Scottish Income Tax rates may apply to Scottish taxpayers.
The annual allowance charge aims broadly to remove the Income Tax relief attributable to the excess pension saving. It does not normally require the pension contribution itself to be withdrawn.
The calculator’s charge estimate may differ where taxable income, reliefs or Scottish tax bands are not fully represented by the salary entered.
How is an annual allowance charge reported and paid?
An annual allowance charge is normally reported through Self Assessment, even where a pension scheme pays some or all of the charge.
The individual is primarily responsible for identifying the charge. Pension providers issue pension savings statements in specified circumstances, but a statement from one scheme does not include pension input held elsewhere.
A member may be able to ask a pension scheme to pay the charge through Scheme Pays. Mandatory Scheme Pays and voluntary arrangements have conditions, elections and deadlines, and payment normally results in a corresponding reduction to pension benefits.
HMRC’s annual allowance guidance explains reporting and payment at a general level.
Common annual allowance calculation mistakes
Common mistakes include entering net personal contributions, omitting employer payments and treating a defined benefit pension as though only employee contributions count.
- Entering a relief-at-source contribution before grossing it up.
- Leaving out salary sacrifice or other employer contributions.
- Using salary alone as adjusted income.
- Ignoring dividends, rental income or bonuses in the taper calculation.
- Using £60,000 as the allowance in a year when tapering applied.
- Carrying forward allowance from the wrong tax years.
- Using carry forward without having been a pension-scheme member in the relevant year.
- Trying to carry forward unused money purchase annual allowance.
- Using a simple pension increase instead of the scheme’s defined benefit pension input amount.
- Assuming carry forward also carries forward unused earnings for personal tax relief.
- Checking only one pension arrangement where several schemes are held.
Important calculator limitations
The calculator provides an indicative pension tax position and cannot reproduce every statutory adjustment, scheme calculation or interaction between tapered and money purchase allowances.
The carry-forward labels shown by a calculator must correspond to the three tax years immediately before the selected year. For 2026/27, figures should relate to 2023/24, 2024/25 and 2025/26, even if an older interface displays different example labels.
The defined benefit field uses a simplified 16-times calculation and may materially differ from the pension input amount calculated by the scheme. Users should obtain a pension savings statement where defined benefit accrual is significant.
The calculator may not fully account for non-salary income, threshold-income adjustments, salary sacrifice anti-avoidance rules, overseas schemes, hybrid arrangements, negative defined benefit input, MPAA interactions or Scheme Pays conditions.
This calculator provides estimates only. Income, pension input amounts, scheme structures, carry forward, tax rates and reliefs differ, and HMRC’s or the pension scheme’s calculation may not match the result shown; professional tax or regulated financial advice may be appropriate before making substantial pension contributions.