Pension Carry Forward

Pension carry forward is a useful tool for pension planning. Once an individual has fully utilised their current tax year’s allowance, one can go back and utilise the unused pension allowance from the previous three tax years, starting with the oldest first. ​Potentially, this enables one to make quite a large pension contribution in a given year. Care needs to be taken on various issues, especially having sufficient ‘earned income’ for the large pension contribution. ​

Here is an example of carry forward at work (assuming an individual  has the standard annual allowance): 

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