If you’re close to your Annual Allowance, you can ask us to apply a cap to your pensionable salary for tax purposes.
You can cap your salary to any level at or above the salary threshold (£58,589.70 for 2019/20).
The Voluntary Salary Cap takes effect from 1 April each year – but the deadline for applications is 3 March.
With a Voluntary Salary Cap, you’ll only pay contributions up to the level of the salary you set, unless you choose to pay 2.5% above the cap to keep life and incapacity cover based on your full salary. Use the Contributions & Tax Calculator to see the impact of different Voluntary Salary Cap levels.
You can get the Voluntary Salary Cap form from the pensions contact at your workplace, and you’ll need to speak to your pension or payroll team because they’ll need to make a change to their payroll for you.
Please note: Since the salary threshold is the subject of an employer consultation, which will complete after the Voluntary Salary Cap deadline (3 March), if you apply for a Voluntary Salary Cap based on the current salary threshold, it will be set to the level of the new salary threshold from 1 April automatically.