Pension Annual Allowance Statements

Perth Police HQ - by Ninian Reid via Flickr
This article was originally published on this website

A (small) number of SPF Members will have recently received an Annual Allowance Statement from the SPPA. This will happen when your accused pension benefits grow over a certain amount in the financial year. This normally impacts on those who have been rapidly promoted, especially in the latter years of service.

Generally speaking you multiply the growth in your pension (adjusted for inflation) in a financial year and multiply it by 16. If the amount is over £40,000 then a tax charge may be liable. Annual Allowance from the previous 3 years can be used to offset any breaches of this limit but this is explained in the paperwork you will have received.

If you receive such a letter it is important that you act upon it. Information on what to do is in the letter and on the sppa website.

Any member with an additional non-police pension will need to also consider this in their calculations.

SPF cannot advise on any pension of tax matters and we would advise the use of an independent financial advisor/accountant if you have any queries.

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