Annual Allowance Limits

Any contributions that exceed the Annual Allowance (AA) result in a tax charge against the Member, paid through payroll.  There is an AA tax charge on the excess amount and charged to an individual pension scheme member if:

• EmployEE personal contributions exceed any salary below £40,000 (regardless of unused allowances).
• EmployEE personal contributions, where salary is £40,000 or above, exceed £40,000 unless there are unused allowances in the previous 3 tax years.
• EmployER company contributions, regardless of salary level, exceed £40,000 unless there are unused allowances in the previous 3 tax years.

The Currencycloud pension scheme, for the purposes of the AA referred to above makes all contributions as “Employer Contributions”.  This definition of contributions for the Scheme is by dint of the salary exchange method of payment.

In effect, any Member (Employee) contribution is a salary reduction for tax purposes, for which the Company agrees to make a pension payment.