Eligibility - frequently asked questions
Your questions answered.
Who is eligible to contribute to a registered pension scheme?
Any individual may contribute to a registered pension scheme. The contributions will receive tax relief if they are under age 75 and:
- they are resident in the UK at some time during the year, or
- they have relevant UK earnings chargeable to UK income tax, or
- they are tax resident in the UK both at some time in the previous 5 tax years and when they became a member of the pension scheme, or
- they (or their spouse or civil partner) have general earnings from overseas crown employment subject to UK tax.
The tax relief will be limited to the greater of £3,600 p.a. and 100% of UK relevant earnings.
HMRC - Pensions Tax Manual - PTM044100: Contributions: tax relief for members: conditions
Can a registered pension scheme be set up solely for the purpose of accepting a transfer value?
Yes.
Can a person with no earnings pay into a registered pension scheme?
So long as they are eligible to contribute to a registered pension scheme (see above) a payment of any amount can be made, regardless of a member's level of earnings. The maximum payment which will receive tax relief is a total gross payment (that is member contributions and basic rate tax relief) of up to £3,600 per annum gross in any tax year.
HMRC - Pensions tax manual - PTM044100: Contributions: tax relief for members: conditions
Disclaimer
The information provided is based on our current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. Also it may not reflect the options available under a specific product which may not be as wide as legislations and regulations allow.
All references to taxation are based on our understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances of the investor.