Pension contributions and tax

SAVE ITEM
stacks of money

16 / 4 / 2014

NHS Pension Scheme (NHSPS) members will normally receive tax relief on their contributions to NHSPS. Contributions are taken from pay before tax is taken off therefore contributions reduce the amount of pay subject to tax.

In addition to the guidance below there are a number of tools available on our website to help employers determine which members of staff are liable to pay a tax charge under the annual and lifetime allowance tax rules.

Annual allowance

The amount of pension savings that benefits from tax relief is limited to an annual allowance, currently £50,000. From tax year 2014-15 onwards the annual allowance will go down to £40,000.

From 6 April 2011 individuals who have enhanced protection will no longer have protection from any annual allowance charge. An individual who has enhanced protection will also be fully liable to the annual allowance charge.

For further information on the annual allowance please see the HMRC website.

Lifetime allowance

The lifetime allowance is currently £1.5 million but this will go down to £1.25 million from 6 April 2014.

For further information on the lifetime allowance please see the HMRC website.

Why Register?

Great reasons to register with NHS Employers

  • A personalised website
    Manage your profile and select topics of interest to you
  • Access your dashboard
    Bookmark useful content to help you quickly find what your looking for
  • Get involved
    Contribute to our Talking Points discussions, comment on and rate our webpages
  • Keep up to date
    Receive the Workforce bulletin and our other newsletters

Sounds great, what next?

Register Now

Not now, I will register later

Log In