RPSM15103360 - Technical Pages: Special annual allowance: Protected inputs - existing: Other money purchase - OPS, public service & GPP: Rate increases
This guidance only applies for the 2009-10 and 2010-11 tax years.
Existing rate of regular contributions increasing
If the rate of existing regular contributions to an other money purchase arrangement under an occupational pension scheme, public sector pension scheme or group personal pension scheme is increased on or after 22 April 2009 / on or after 9 December 2009 and the increase is not made in accordance with
- an agreement made before noon on 22 April 2009 / made before 9 December 2009 (see RPSM15103310), or
- a written application made before noon on 22 April 2009 / made before 9 December 2009 (see RPSM15103410)
only part of the pension input amount relating to the increased rate of contributions will be a protected pension input amount.
The protected pension input amount will be the pension input amount that would have occurred if the rate had not increased.
Example
Andrew has relevant income of £160,000 and has existing regular contributions of £2,000 per month which meet the conditions for a protected pension input amount. The total pension input amount in respect of those contributions would have been £24,000 (12 x £2,000) if the rate had not increased.
However, after 6 months the rate is increased to £3,000 per month. The total pension input amount now is £30,000 ([6 x £2,000] + [6 x £3,000]).
The protected pension input amount in relation to the total pension input amount of £30,000 is £24,000 (being the amount based on the monthly rate before the increase) and the amount which is not protected is £6,000 (being £30,000 - £24,000).
Where the above applies for a particular tax year in respect of an individual (because that individual’s relevant income is £130,000 or more for the tax year concerned), the references to 22 April 2009 apply in relation to an individual who has relevant income of £150,000 or more for 2009-2010. Otherwise the above would still apply but the references to 9 December 2009 apply instead (see RPSM15103025 for more details).
| Glossary (RPSM20000000) |
