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following are gross personal pension contributions:
11/12 ….. 22,000
12/13 ….. 36,000
13/14 ….. 43,000
14/15 ….. 58,000earnings are 200,000 each year
state the amount of unused annual allowances to carry forward to 15/16
the answer is also reproduced below:
——————–Available ————–Used—————Carried forward
14/15 …………..40,000 …………….(40,000)……………….nil
11/12 …………..28,000 …………….(18,000) ……………..n/a
12/13 ……………14,000 …………………………………………..14,000
13/14 …………….7,000…………………………………………….7,000
———————————————————————————————
total……………….89,000……………….(58,000)……………….21,000for 11/12 it says ” the remaining allowance from 11/12 of 10,000 cannot be carried forward to 15/16 as it is more than 3 years ago”
i dont understand the treatment of 11/12.
for 15/16, 11/12 is more than 3 years so shdnt the ENTIRE amount be unavailalbe?? and whats this 10,000 he is talking about??
In the 14/15 tax year the AA limit is 40,000 and in prior years it was 50,000.
Therefore in 14/15 when 58,000 was paid, that uses up the 40,000 AA from 14/15 and then uses 18,000 of unused AA from previous 3 years on a FIFO basis starting with the 11/12 tax year. In 11/12 there is unused AA of 28,000 (50,000 – 22,000) of which 18,000 (58,000 – 40,000) is now used. This would leave 10,000 unused AA in 11/12 but this will not be able to c/f to 15/16 as unused AA can only be c/f for 3 years.
The only unused AA that may be c/f for use in 15/16 will therefore be from 12/13 = 14,000 (50,000 – 36,000) and from 13/14 = 7,000 (50,000 – 43,000). There is no unused AA from 14/15 to c/f so the total unused AA c/f = 21,000.
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