The maximum total amount you can pay in (‘contribute’) to your pensions each tax year is usually the same as your yearly earnings, up to a maximum of £60.000. This is called your annual allowance and it includes the tax relief (a top-up from HMRC) you get on anything you pay in. ❗ Contributing more than your annual allowance is against the rules and could mean getting a tax charge from HMRC.

Here's a quick example of how the allowance works. Say you earn £30,000, you can pay up to a total of £30,000 into your pension(s) in the tax year. Of this, £24,000 can be your own money, and HMRC would top this up with basic-rate (20%) tax relief of £6,000.

Good to know 💡: If you don’t have any earnings and are a UK resident, you still get an allowance you can pay into your pension each year. It's £3,600, including basic-rate tax relief.

Things get a little more complicated if you have income over £260,000, or if you’ve already taken money out of a pension. The limit on how much you can pay into your pension is likely to be lower than £60,000. However you may be able to scrape some allowance back if you didn’t use all your annual allowance in any of the last three tax years.

Last but definitely not least, pension and tax rules can always change, and other factors may affect how much you can pay into your pension. If you’re unsure about how much you can pay into your pension, you may want to speak to a qualified financial adviser first. You can also get free and impartial pension guidance on the government's MoneyHelper website.