Since 2020, if your ‘threshold income’ is above £200,000 and your ‘adjusted income’ is above £240,000, your pension annual allowance could potentially have reduced. Specifically, for every £2 you earned above £240,000, you were losing £1 of your annual allowance to a minimum of £4,000.
The 2023 Spring Budget increased the adjusted income level required for the tapered annual allowance from £240,000 to £260,000, from 6th April 2023. The minimum amount of tapered allowance also increased from £4,000 to £10,000.
See also our tax benefits of a pension blog post.
