A tax year runs from 6 April one year to 5 April the next year. So, the end of the tax year may be the ideal time to check in on your pension and make the most of your pension allowances and the tax benefits you receive.

Pensions are one of the most tax-efficient ways to save for your future. Any regular or one-off contributions you make receive tax relief from the government. So, the more you pay in now, the more chance it has to grow and help you to reach your retirement goals. Remember, any contributions you make are invested until at least age 55 (57 from 2028), so while your investments could grow, they can also go down. You could also get back less than you put into your plan. Tax relief depends on your individual circumstances, where you like in the UK and could change in the future. 

There's a limit to the amount you can pay in and receive tax relief, there's more detail on this below.

 

Pension allowances

The pension annual allowance is the limit of the amount you can pay into all your pension plans before you have to pay a tax charge. For the 2024/25 tax year the annual allowance is £60,000, if you pay more than this into your pension plans a tax charge may apply to your contributions.

You can pay in up to 100% of your earnings or if you don't pay tax, you can pay in up to £2,880 and receive tax relief. If you pay in more than £60,000 then you could be subject to a tax charge due to the annual allowance.

If, like most people, you haven't exceeded these limits you can make use of the tax incentives on your pension by paying a one-off pension contribution or increasing your regular contributions. You'll be able to see your current contributions by logging in to our mobile app.

There are other pension allowances that may apply if you've already starting taking money from your pension or if you have a high income. For more information on this you can read our pensions and tax - know your limits article or it may be best to speak to a financial adviser, they may charge for any advice they give.

Tax rules and legislation can change. The amount of tax relief you receive depends on your individual circumstances and where you live in the UK.

Tax year end deadline for contributions

The end of the tax year is 5 April. If you want to make a one-off contribution to your Royal London plan, and your budget allows, you need to be sure the funds are with us by 6pm on Friday 4 April 2025 for it to count towards this tax year. If we receive your contribution after then, it will be added to your plan and applied against your annual allowance for the next tax year. Don't forget, you can make one-off contributions to your plan and increase your regular contributions at any time throughout the year.

Tax year end may also be a time when you get a bonus from your employer, so you could ask them to pay some or all of it into your pension. This is called bonus exchange or bonus sacrifice. You won't pay tax or National Insurance on the bonus amount you choose to exchange for a pension contribution. You can find out more by reading our article or your employer may be able to help with next steps.

It's important to remember that if you’re posting any documentation or if you need to speak to a financial adviser, you need to allow enough time before the tax year ends. You can speak to your financial adviser or get in touch with us using the details below to find out more.

Get in touch

If you have a Pension Portfolio plan and you’d like to speak to us about one-off pension contributions, please phone us at 0345 603 0154

If you’d like to speak to us about regular contributions please phone us at 0345 850 8953. You can find out more about regular contributions on our making contributions to your Royal London plan page.

Our lines are open Monday to Friday, from 8am to 6pm (excluding Bank Holidays).

You may also be able to make a one-off pension contribution using our online form, depending on the type of plan you have.

Make a one-off pension contribution

Keep track of your pension

See how much you’ve saved in the last twelve months, the contributions you’ve made and what your pension savings are worth now on the Royal London mobile app.

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