What is pension annual allowance carry forward?

If you didn't use your full £60,000 pension Annual Allowance in any of the previous 3 tax years, you can carry forward the unused amount and add it to this year's allowance. This lets you make a much larger pension contribution in a single year without triggering a tax charge. You must have been a member of a registered pension scheme in the years you are carrying forward from.

How much can I carry forward pension contributions?

Up to 3 years of unused Annual Allowance. The maximum is the current year's £60,000 plus up to £60,000 from each of the 3 previous years — a theoretical maximum of £240,000 in a single year (assuming you used none of your allowance in the previous 3 years). In practice, your contribution is limited to your relevant UK earnings or your employer's contribution.

Do I need to tell HMRC about carry forward?

No — there is no form to fill in or notification to make. You simply make the contribution and, if HMRC queries it, you demonstrate that you had unused allowance by showing your pension input amounts for the relevant years. Keep records of your pension contributions and annual statements showing inputs for the previous 3 years.

What counts towards the Annual Allowance?

Both YOUR contributions and your EMPLOYER's contributions count. For a defined benefit scheme like the NHS pension, the 'contribution' is calculated as the increase in the value of your pension benefits over the year (not the actual money deducted from your salary). This is shown on your annual pension statement as the 'Pension Input Amount'.

Pension Annual Allowance Carry Forward — How to Use Unused Allowance from Previous Years | PocketWise

The Annual Allowance is the maximum amount that can be paid into your pensions each year with tax relief. If you have not used the full amount in previous years, you can carry forward the unused allowance to make a larger contribution now.

Annual Allowance — Basics

Detail	2026/27
Standard Annual Allowance	£60,000
Tax-free pension contributions (below AA)	No tax charge
Tax charge if you exceed AA	At your marginal rate (20%/40%/45%)
Carry forward	Up to 3 previous years of unused allowance
Money Purchase Annual Allowance (MPAA)	£10,000 (if triggered)
Tapered Annual Allowance	Reduces for income above £260,000 (minimum £10,000)

How Carry Forward Works

Rule	Detail
How many years?	Up to 3 previous tax years
Which years for 2026/27?	2023/24, 2024/25, and 2025/26
Order	Oldest year’s unused allowance is used first
Must you have been in a pension scheme?	Yes — you must have been a member of a registered pension scheme in each year you carry forward from
Must you notify HMRC?	No — just keep records
Does employer contribution count?	Yes — both your and your employer’s contributions count towards the AA

Worked Example 1 — Simple Carry Forward

A higher-rate taxpayer who has been in a workplace pension for several years:

Tax year	Annual Allowance	Total pension input	Unused allowance
2023/24	£60,000	£15,000	£45,000
2024/25	£60,000	£20,000	£40,000
2025/26	£60,000	£18,000	£42,000
2026/27 (current year)	£60,000
Total available 2026/27			£187,000

This person could contribute up to £187,000 in 2026/27 without triggering an Annual Allowance tax charge (£60,000 current + £127,000 carried forward).

Important: The contribution cannot exceed their relevant UK earnings for the year. If they earn £100,000, they can contribute up to £100,000 (and the remaining carried-forward allowance is lost).

Worked Example 2 — NHS Consultant With High Pension Input

High-earning NHS consultants often have large pension input amounts due to the defined benefit scheme:

Tax year	Annual Allowance	Pension Input Amount (PIA)	Unused/Excess
2023/24	£60,000	£52,000	£8,000 unused
2024/25	£60,000	£58,000	£2,000 unused
2025/26	£60,000	£48,000	£12,000 unused
2026/27	£60,000	£70,000	-£10,000 excess

Without carry forward, this consultant would face a tax charge on £10,000 of excess contributions. With carry forward:

Available carry forward	Amount
2026/27 standard AA	£60,000
Unused from 2023/24	£8,000
Unused from 2024/25	£2,000
Unused from 2025/26	£12,000
Total available	£82,000

The £70,000 pension input is within the £82,000 total — no tax charge.

Worked Example 3 — Self-Employed Person Making a Large One-Off Contribution

A self-employed person earning £80,000 who has contributed minimally to their SIPP for 3 years:

Tax year	Annual Allowance	Contribution	Unused
2023/24	£60,000	£5,000	£55,000
2024/25	£60,000	£5,000	£55,000
2025/26	£60,000	£5,000	£55,000
2026/27	£60,000	Want to contribute £80,000

Total available: £60,000 + £55,000 + £55,000 + £55,000 = £225,000

They can contribute £80,000 (limited to their earnings) with full tax relief:

Tax relief calculation	Amount
Contribution	£80,000
Basic rate relief (applied at source in a SIPP)	£16,000 reclaimed by the pension provider
Higher rate relief (claimed via Self Assessment)	£16,000 reclaimed by the contributor
Effective cost	£48,000

Related: How Pension Tax Relief Works

Tapered Annual Allowance

High earners face a reduced Annual Allowance:

Detail	Amount
Adjusted income threshold	£260,000
Threshold income	£200,000
Taper	£1 reduction for every £2 above £260,000 adjusted income
Minimum tapered AA	£10,000 (for adjusted income of £360,000+)
Carry forward still available?	Yes — but you carry forward the tapered amount from previous years, not the full £60,000

Example — Tapered AA With Carry Forward

Detail	Amount
2026/27 adjusted income	£300,000
Tapered AA for 2026/27	£40,000 (reduced by £20,000)
Previous year tapered AA unused	£15,000
Total available	£55,000

Money Purchase Annual Allowance (MPAA)

Detail	Information
What triggers it	Taking taxable income from a defined contribution pension (not just the 25% tax-free lump sum)
Reduced allowance	£10,000 per year for money purchase contributions
Can you carry forward?	The MPAA cannot be carried forward. However, carry forward of the standard AA from years BEFORE the MPAA was triggered may still be possible for defined benefit pension inputs
Important	The MPAA only applies to money purchase (defined contribution) pensions — your defined benefit pension is assessed against the remaining “alternative Annual Allowance”

How to Check Your Position

Defined Contribution Pensions (SIPPs, Workplace DC)

Step	Action
1	Check your pension provider’s annual statements for contributions each year
2	Add your contributions + employer contributions = total pension input
3	Compare to the £60,000 AA for each year
4	The difference is your unused allowance to carry forward

Defined Benefit Pensions (NHS, Teachers, Civil Service, etc.)

Step	Action
1	Check your annual pension statement for the Pension Input Amount (PIA)
2	This is NOT the same as your salary deduction — it’s the increase in the value of your benefits
3	Compare the PIA to the £60,000 AA
4	The difference is your unused allowance

Warning for DB scheme members: Salary increases, promotions, and bonuses can cause large spikes in your PIA. A significant pay rise in one year can push your PIA well above £60,000 — use carry forward to cover the excess.

Tax Charge If You Exceed the AA

Detail	Information
Rate	Your marginal tax rate (20%, 40%, or 45%)
On what	The amount by which your pension input exceeds your available AA (including carry forward)
How to pay	Through your Self Assessment tax return
Scheme Pays	If the charge is £2,000+ and you exceeded the standard AA, you can ask your pension scheme to pay the charge from your pot
Deadline	Report on your Self Assessment by 31 January following the tax year

Common Mistakes

Mistake	Consequence
Forgetting employer contributions count	You exceed the AA without realising
Not checking pension input amounts for DB schemes	PIA can be much higher than salary deductions
Assuming carry forward is automatic	You must have been a pension scheme member in the carry-forward years
Making a contribution larger than earnings	Tax relief is limited to your relevant UK earnings
Not keeping records	If HMRC queries your carry forward, you need evidence