Pension Annual Allowance Calculator 2026/27
Enter your threshold and adjusted income to see your annual allowance — £60,000 as standard, tapered by £1 for every £2 of adjusted income over £260,000, to a £10,000 floor.
How it works
The standard annual allowance is £60,000 in 2026/27 — the most that can go into your pensions each year (your contributions, employer contributions and tax relief combined) without a tax charge.
The taper needs two figures: THRESHOLD income (broadly, taxable income minus your own pension contributions) and ADJUSTED income (taxable income plus employer pension contributions). If threshold income is over £200,000 AND adjusted income is over £260,000, your allowance shrinks by £1 for every £2 above £260,000, down to a £10,000 minimum at £360,000+.
If you have flexibly accessed a defined-contribution pension (e.g. drawdown income or a UFPLS), the Money Purchase Annual Allowance of £10,000 applies to DC savings instead — and carry-forward cannot be used for DC contributions. Otherwise, unused allowance from the previous 3 tax years can be carried forward on top of this year’s allowance.
FAQ
What is the pension annual allowance for 2026/27?
£60,000 for most people — unchanged since April 2023. This covers everything paid into your pensions in the tax year: your own contributions, the tax relief added to them, and anything your employer pays in. Going over it doesn’t stop the contributions, but the excess is added to your taxable income through the annual allowance charge unless you have carry-forward available.
What is the difference between threshold income and adjusted income?
Threshold income is roughly your total taxable income MINUS pension contributions you pay personally; adjusted income is taxable income PLUS employer pension contributions. The two-test design stops people dodging the taper by swapping salary for employer contributions. If threshold income is £200,000 or less you escape the taper entirely, no matter how large adjusted income is.
How does carry-forward work?
You can add unused annual allowance from the previous three tax years — for 2026/27 that means 2023/24, 2024/25 and 2025/26, each with a £60,000 allowance. You must have been a member of a registered pension scheme in those years, and you use the current year’s allowance first, then the oldest carried-forward year. In theory a maximum of £240,000 could be contributed in one year.
What triggers the £10,000 MPAA?
Flexibly accessing a defined-contribution pension: taking taxable drawdown income, a UFPLS lump sum, or exceeding the cap on a capped-drawdown plan. Taking only the 25% tax-free lump sum does NOT trigger it. Once triggered, DC contributions above £10,000 a year attract a charge and carry-forward can no longer be used for DC savings — a major trap for people who dip into a pension while still working.