Pension Annual Allowance and Lump Sum Limits
The yearly limit on tax-relieved pension saving, how it shrinks for high earners and after drawing a pension, and the caps on tax-free lump sums.
Annual allowance
£60,000
The most that can be saved into pensions each tax year, by you and your employer combined, before a tax charge. Unused allowance from the previous three years can usually be carried forward.
GOV.UK — HMRC · checked 30 Sep 2026
Money purchase annual allowance
£10,000
Applies instead once you've flexibly taken money from a defined contribution pension.
GOV.UK — HMRC · checked 30 Sep 2026
Annual allowance starts to taper above (adjusted income)
£260,000
Falls by £1 for every £2 of adjusted income above this, if threshold income is also above £200,000.
GOV.UK — HMRC · checked 30 Sep 2026
Lump sum allowance
£268,275
The most that can be taken as tax-free lump sums over your lifetime, unless you hold a protected allowance.
GOV.UK — HMRC · checked 30 Sep 2026
Lump sum and death benefit allowance
£1,073,100
The overall cap on tax-free lump sums in life and certain lump sums paid on death before 75.
GOV.UK — HMRC · checked 30 Sep 2026