Glossary · UK
What is Threshold Income (Pension Taper)?
Income measure used to test whether the £200,000 pension tapering trigger applies.
Full Definition
Threshold Income is the first gate for Tapered Annual Allowance. It is broadly your taxable income from all sources (employment, self-employment, dividends, rental, savings) minus relief-at-source personal pension contributions, plus any salary sacrifice arrangement set up on or after 9 July 2015. If Threshold Income is £200,000 or below, the taper does NOT apply — even if Adjusted Income is over £260,000. Above £200,000, you must then test Adjusted Income to see how much your Annual Allowance is cut.
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Disclaimer: Definitions are for guidance only. For decisions about your tax, savings, property or pension situation, always consult a qualified professional or refer to gov.uk.