Pension carry forward
How to increase your pension allowance
Important information: SIPPs are a type of pension for people happy to make their own investment decisions. Investments can rise and fall in value so you could get back less than you pay in. You’ll usually need to be at least 55 (rising to 57 from 2028) before you can access the money in your pension. Pension and tax rules can change, and any benefits will depend on your circumstances. If you’re not sure what’s best for your situation, you should seek financial advice.
What is pension carry forward?
Generally the most you can pay into your pension each tax year is as much as you earn, up to the annual pension allowance which is currently £60,000 for most people.
If you want to make the most of your pension savings and tax allowances, carry forward lets you take advantage of any unused pension allowance from the previous three tax years. Including the current tax year, that could mean you’re able to make a pension contribution of up to £220,000 including tax relief in 2025/26.
If you want to claim back the full amount of tax relief, you have to pay enough tax at the relevant rate. Our tax relief calculator can show you how much you could get.
Remember, tax rules can change and any benefits will depend on your circumstances. Scottish tax rates and bands differ.
Who can use pension carry forward?
There are two main requirements:
- You had a pension in each year you wish to carry forward from, whether or not you made a contribution (the State Pension doesn’t count).
- You have earnings of at least the total amount you are contributing this tax year. Alternatively, your employer could contribute to your pension.
There are other factors to consider if you or your employer have contributed to other pensions in addition to your SIPP or you have been a member of a final salary scheme.
Learn more in our Carry Forward and Annual Allowance Factsheet
What's the tapered annual allowance?
As a high earner, you may be affected by the tapered annual allowance.
The taper could reduce your annual allowance to as little as £10,000 if you have an ‘adjusted income’ of over £260,000. Adjusted income is broadly your total income, plus the pension contributions your employer pays in for you.
Making the most of any unused pension allowance, using carry forward, means you could pay more in and get extra tax relief.
Can you backdate pension contributions?
You can carry forward unused annual allowances from the three previous tax years, as long as you were a member of a pension during that time. In the last two tax years, the annual allowance was £60,000 for most people, and in the tax year before that it was £40,000 for most people.
It can be confusing, so here's an example to show you how it works. Remember though, you normally need to be at least 55 (57 from 2028) before you can access money in your pension.
| Tax year | Annual allowance | Contributions made | Unused allowance |
|---|---|---|---|
| 2022/23 | £40,000 | £15,000 | £25,000 |
| 2023/24 | £60,000 | £5,000 | £55,000 |
| 2024/25 | £60,000 | £20,000 | £40,000 |
| 2025/26 (current) | £60,000 | £60,000 | £0 |
| Remaining allowance in 2025/26 using carry forward: | £120,000 | ||
Carry forward calculator
Find out how much unused pension allowance, from the last three years, you may be able to pay into your pension for the current tax year.
How to make a pension contribution
If you have a workplace pension, your employer will make contributions on your behalf, paying money directly into your pension. You can also make contributions yourself directly through your pay, or as single payments on top of any automatic payments already set up. Some employers may match what you pay in, up to a certain limit. You should contact your employer to find out your options.
If you don’t have a workplace pension, or you’re already making the most of your employer's matching scheme, you could consider opening your own private pension such as the HL Self-Invested Personal Pension.
How to make a contribution to your HL SIPP
The quickest way to add money to your SIPP is with a lump sum online or through the HL app. Please read the Key Features (including contribution checklist) first, then:
1. Log in
to your
account online or through the HL app
2. Select your SIPP account and choose 'Add money'
3. Follow the debit card instructions
Don’t forget our UK-based helpdesk are on hand to answer any questions you might have. And you can view our charges online anytime.
Money in a pension isn’t usually accessible until age 55 (57 from 2028).
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Help and support
Take a look at our most frequently asked questions for quick answers.
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