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Barnett Waddingham
0333 11 11 222

Long service and implications on annual allowance

Published by Bhargaw Buddhdev on

We were asked to advise a leading University in relation to its senior staff.

Particular issues arose with one senior staff member with long service.  His pay history meant that the pension accrual had exceeded the annual allowance (AA) (£50,000) in each of the last 3 tax years.  He therefore had no unused allowances to be carried forward.  He had also been paying AVCs. We identified that his pension accrual would be in excess of the AA (£50,000).  We pointed out the tax consequences of continuing to pay AVCs and showed the University the advantage of reducing the pensionable salary for the senior employee.


This advice reduced his AA and used the University's pension savings to provide a non-pensionable salary supplement to the senior employee.

About the authors

  • Bhargaw Buddhdev

    Bhargaw Buddhdev is a pensions actuary and he is our expert for dealing with pension taxation issues for individuals and their employers.

    View Biography

  • Lisa Lawson

    Lisa has a range of experience in providing advice to pension scheme trustees and sponsors including scheme funding issues, investment strategy and corporate accounting.

    View Biography

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