Annual allowance
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Annual allowance
The annual allowance sets the limit on the amount your pension can grow each tax year without incurring a tax charge. This includes your pension from the Plan and any other private pensions you may have.
The annual allowance for the 2025/2026 tax year is £60,000.
If the difference between the capital value of your pension at the start of the year exceeds the value at the end of the tax year by more than the annual allowance, the excess would be subject to a tax charge.
For information on how to calculate this, visit the HMRC website.