Glossary · Pensions
Tapered annual allowance (pensions)
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Definition: Reduces the £60,000 pension annual allowance for very high earners, by £1 for every £2 of adjusted income over £260,000, down to a £10,000 minimum.
Applies only if both 'threshold income' exceeds £200,000 and 'adjusted income' exceeds £260,000 (definitions in PTM057000). Carry-forward of unused allowance from the previous three tax years can mitigate the impact.
Primary source: gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm057100