To ask the Chancellor of the Exchequer, how much revenue has been raised in each of the last five years as a result of the pensions annual allowance tax charge from (a) defined contribution and (b) defined benefit scheme members.
Answered on
25 April 2022
We do not hold the information requested. Annual Allowance (AA) tax charges can be reported via Accounting for Tax (AfT) returns which are completed by the scheme administrator, and via Self-Assessment (SA). Neither AfT nor SA returns require information on the type of pension scheme that the charge relates to. In addition to this, the AA applies to an individual’s pension accrual across all pensions held, which could cover both defined benefit and defined contribution schemes.
However, HMRC publish data on the number and value of AA charges reported to us through AfT and SA, as well as the value of contributions exceeding the allowance. The AfT and SA columns are not mutually exclusive, the same case could appear in both columns. Individuals are required to report AA breaches through SA returns even if their scheme pays the charge and reports the breach through AfT returns. However, in practice individuals may be reported through AfT and not report themselves through SA, or vice versa, in error. The data for the last five available tax years is below:
Tax Year | Number of Annual Allowance charges reported by the scheme through Accounting for Tax returns | Total value of Annual Allowance charges reported by the scheme through the Accounting for Tax returns (£ million) | Number of individuals reporting pension contributions exceeding their Annual Allowance through Self Assessment | Total value of pension contributions exceeding the Annual Allowance reported through Self Assessment (£ million) |
2015 to 2016 | 3,010 | 62 | 5,460 | 143 |
2016 to 2017 | 2,920 | 63 | 18,710 | 584 |
2017 to 2018 | 6,710 | 122 | 29,920 | 912 |
2018 to 2019 | 13,700 | 210 | 34,260 | 819 |
2019 to 2020 | 21,410 | 253 | 42,350 | 949 |