For pensioner members, pensions are increased each April to keep up with the cost of living. This year your pension will increase by 3.1%. This increase is based on the Consumer Price Index (CPI) from the previous September and is set by law. The basic state pension will also increase by the same amount of 3.1%. The Fund’s annual Pensions Newsletter was issued in early April and includes further details on this. It can be viewed in Resources.
The two tax limits, Annual Allowance and Lifetime Allowance, will remain the same as their previous values. Annual Allowance is the amount you or your employer can pay into your pension in a tax year before you must pay a tax charge. The Annual Allowance is currently £40,000 for most members, however from 6 April 2016 the limit has been reduced or tapered for higher earners.
The Lifetime Allowance is simply the total amount of pension you can have without triggering a tax charge. Lifetime Allowance will remain at £1,073,100 until April 2026. There are detailed guides about both the Lifetime Allowance and Annual Allowance in the Resources section of our website.
If you pay more into your pension via Additional Pension Contributions (APCs), the limit for 2022/23 is now £7,075. More information on APCs can be found here.
There have also been changes to the contribution rates for 2022/23 as explored in a previous news article. Your contribution rate is how much you pay into your pension which varies depending on exactly how much you earn. The new figures are viewable here.
These are the main financial changes which are applicable to pensions, many or all the changes listed may not affect you depending on your current circumstances.
As always if you have any concerns or queries about your pension you can contact the Fund through one of the options at Contact Us.