Pension tax benefits depend on your individual circumstances, and tax rules and allowances may change.
For 2026/27, HMRC lists a standard annual allowance of £60,000, with tapering potentially applying where threshold income exceeds £200,000 and adjusted income exceeds £260,000. The minimum tapered annual allowance is £10,000. Pension input, employer contributions, carry forward and earnings definitions must be calculated before acting; headline salary alone is not enough.
Why lawyers need a year-by-year calculation
Bonus income, profit allocations, employer contributions and a move into partnership can change the pension picture significantly between tax years. A rule of thumb based only on salary can miss both tapering and contributions already made by an employer.
The 2026/27 reference points
| HMRC measure | 2026/27 amount |
|---|---|
| Standard annual allowance | £60,000 |
| Threshold income limit | £200,000 |
| Adjusted income limit | £260,000 |
| Minimum tapered annual allowance | £10,000 |
| Money purchase annual allowance | £10,000 |
These figures are reference points, not a contribution recommendation. Threshold and adjusted income use specific definitions, and pension input can include employer funding. Defined-benefit pension input is measured differently from cash contributions.
Build the evidence pack first
- Pension statements and contribution history for the current and previous three tax years.
- Employer contribution records and any salary exchange arrangements.
- Bonus, drawings, partnership profit and other taxable income estimates.
- Evidence of any flexible pension access that could trigger the money purchase annual allowance.
- Any fixed or enhanced protection and previous annual-allowance charges.
Providers, payroll teams and advisers need time to verify pension input and process contributions. Start the calculation while there is still room to correct missing information.
Coordinate pension planning with the wider plan
Pensions involve restricted access. A contribution that appears tax-efficient can still be unsuitable if it compromises tax reserves, partnership capital or a near-term property decision. Balance the pension calculation with liquidity and the point at which the household may need to use the money.
Frequently asked questions
What is the pension annual allowance in 2026/27?
HMRC lists the standard annual allowance as £60,000, subject to individual circumstances including tapering and the money purchase annual allowance.
Can unused annual allowance be carried forward?
Carry forward may allow unused allowance from the previous three tax years, subject to conditions including scheme membership and the rules applying in each year. Obtain a calculation before contributing.
Does a large pension contribution always receive full tax relief?
No. Tax relief, relevant UK earnings, annual-allowance limits and the way the contribution is made all matter. Personal and employer contributions can be treated differently.
Sources and review notes
This briefing uses primary or public-service sources. Rules and their effects depend on individual circumstances and can change.
- HMRC: pension scheme rates for 2026/27
- HMRC: annual allowance carry forward
- HMRC: tax on private pension contributions
- MoneyHelper: pension annual allowance
Published: 23 August 2026 · Last reviewed: 23 August 2026
The value of investments can go down as well as up, and you may get back less than you invest.
Would regulated personal advice help?
Learn about our adviser selection standards and how each introduction is limited to one named recipient.
Book with Lawrence