GLOSSARY

Pension input amount definition

What does Pension input amount mean?

The annual increase in an individual's pension provision (which should not exceed the annual allowance), calculated over the pension input period. While although the annual allowance applies on a tax year basis, the PIA is a measure which is not specified as having to be calculated over the tax year – it can cover a different period and is defined by the trustees of a plan.

For DC members the PIA is the total of tax relievable contributions paid by the member and any contributions paid by the employer on behalf of the member. For DB members the PIA is calculated as the increase in the value of final salary during the pension input period. To calculate the increase, the accrued annual pension is valued using a factor of 10:1. There is no PIA in an arrangement for the tax year in which the individual crystallises all benefits under that arrangement, known as ‘last year PIA exemption’. The amount of contributions paid and increases in value of a member's benefits for annual allowance purposes as calculated in accordance with Finance Act 2004, ss 230237.


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