Employment Tax

Pension input periods

Produced by Tolley in association with John Hayward
  • 19 Oct 2021 23:16

The following Employment Tax guidance note Produced by Tolley in association with John Hayward provides comprehensive and up to date tax information covering:

  • Pension input periods
  • Introduction
  • PIPs for 2015/16 and beyond
  • Aligning the PIP to the tax year ― transitional arrangements applied to 2015/16

Pension input periods

Introduction

The annual allowance in relation to registered pension schemes is the maximum amount:

  1. by which a member’s benefits can increase in a pension input period (PIP) (in respect of defined benefit schemes)

  2. that can be contributed to pension arrangements in a PIP (for defined contribution or money purchase schemes)

If the annual allowance is exceeded there is a tax charge (the annual allowance charge) on the member.

See the Annual allowance guidance note.

PIPs for 2015/16 and beyond

In order to facilitate the taper of the annual allowance for the higher paid, and as a much welcomed general simplification, PIPs were aligned with the tax year by 5 April 2016 instead of a year ending in the tax year.

So from 6 April 2016, all pension arrangements have a 12-month PIP, the first

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