Limits and taxation

The Fund is a registered pension scheme for HM Revenue & Customs (HMRC) purposes. As a registered pension scheme, it enjoys several tax advantages. Consequently, HMRC impose limits on the amount of pension savings you can make each year, and build up over your working life. It is your responsibility to ensure you monitor and understand how your pension savings may be affected by the allowances imposed by HMRC.

The Annual Allowance

The Annual Allowance is a limit on the amount of pension savings that you can build up that may qualify for tax relief, in any one tax year. There are no active members contributing to the Nationwide Pension Fund and Annual Allowance does not affect your previous pension contributions at NPF.

The Lifetime Allowance

The Lifetime Allowance is a limit on the total value of the pension savings, that you can build up during your working life in the Scheme, and any other registered pension scheme. This limit applicable from 6 April 2021 is £1,073,100 and has been frozen at this level until the 2025/26 tax year. You may be subject to an additional tax charge if the value of all your pension benefits exceeds the Lifetime Allowance.

Further information on either the Annual Allowance or Lifetime Allowance can be found by visiting:

www.moneyhelper.org.uk or www.hmrc.gov.uk