Answers · UK 2025/26
How does pension carry forward work in the UK?
Pension carry forward lets you use unused annual allowance from the 3 previous tax years. You must have been a member of a registered pension scheme in each of those years. The current year's £60,000 allowance is used first, and you cannot carry forward if you have triggered the Money Purchase Annual Allowance.
Full answer
Pension carry forward is a rule that allows you to make pension contributions above the standard £60,000 annual allowance in a given year, by using unused allowance from the previous three tax years. How it works: - Current year's annual allowance (£60,000 for 2026/27) must be fully used first. - You then carry forward unused allowance from the earliest eligible year first (3 years ago), then 2 years ago, then last year. - The maximum you could theoretically contribute in a single year using carry forward: current year £60,000 + three prior years of unused allowance (maximum £60,000 each) = up to £240,000. Conditions: - You must have been a member of a registered pension scheme in the years from which you are carrying forward. Being a member of a workplace pension (even if no contributions were made) counts. - You must have sufficient UK earnings in the current tax year to support the contribution (pension contributions are limited to 100% of UK earnings or £60,000, whichever is lower, but carry forward lets you use allowance -- you still need the earnings to actually contribute). - You cannot have triggered the Money Purchase Annual Allowance (MPAA) -- this applies if you have already flexibly accessed a defined contribution pension pot. Useful scenarios: - Large bonus year: carry forward unused allowance to shelter more of a one-off bonus. - Self-employed profit variation: a high-profit year can be used to maximise pension contributions using carry forward. - Business disposal: Business Asset Disposal Relief gain plus pension carry forward is a common tax planning combination. How to use it: - Personal contributions: contribute to a SIPP or employer scheme and claim on Self Assessment. - No formal claim to HMRC is needed for carry forward itself -- it is tracked internally.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.