Is it £40K or £60K you can put in a pension tax free each year?

[User19798]

I am self employed, no pension atm.
I have managed to completely confuse myself over private pensions - I know it was £40K a year to get the 25% but has it risen to £60K?
Many thanks

Following

£60k or your annual earnings - whichever is lower.

And that limit includes the tax relief, and employer contributions where relevant.

It was £40k for several years up until 22/23 tax year and is now £60k for the current tax year (unless you earn enough to hit the taper provisions - broadly over £200k - or have already started to access a defined contribution pension)

thanks so much, I realise how stupid I sound, I have been reading and reading so much I have confused myself. Thanks again

Note, you can normally carry forward unused allowances from the previous 3 tax years (which were confusingly £40k in the last 3 years), but only if you were a scheme member at the time. If you haven't started a pension yet, your contributions this year will be capped at the lower of £60k or your relevant earnings. (which excludes any dividends you pay yourself unfortunately).

Note though, that if some of your work is via a company of which you are a director, the company can contribute to your pension without regards to your "income" - you won't get the tax benefit personally but your company will.