RPSM15100540 - Technical Pages: Special annual allowance: Overview: Existing pension savings

This guidance only applies for the 2009-10 and 2010-11 tax years.

What about existing pension saving arrangements?

The special annual allowance does not apply to pension input amounts that represent continuing, regular, pension saving under arrangements that were in place immediately before:

• 22 April 2009, or
• in the case of individuals with relevant income for the tax year 2009-2010 of less than £150,000, 9 December 2010.

Such amounts of pension saving are protected pension input amounts and, though not tested against the special annual allowance, they will continue to be tested against the annual allowance in the usual way (see RPSM06100000).

However, protected pension input amounts have a bearing on an individual’s special annual allowance as the allowance for a tax year gets reduced by

• the amount of the protected pension input amounts for that year, and for the tax year 2009-2010 only, any
• pre-22 April 2009 pension input amounts, or
• in the case of individuals with relevant income of less than £150,000 for the tax year 2009-2010, any pre-9 December 2009 pension input amounts.

This can have the effect of reducing the special annual allowance to nil for an individual if any or all of these respective amounts are £20,000 or more.

More details about how the special annual allowance is calculated for an individual can be found in RPSM15102010.