Most people are unlikely to exceed the payment limits for pensions every year - but it's useful to know what they are as it could affect the amount of tax you pay.
For more information on the allowances, download Information about tax relief, limits and your pension (PDF, 190KB).
Tax rules and limits may change in the future. The information here is based on our pension experts' understanding in April 2021. Your own circumstances - including where you live in the UK - also have an impact on tax treatment. Find out more about how tax rates can differ on gov.uk.
The annual allowance
The Government sets a limit on how much you can pay into your pension every year without incurring tax penalties. This means total payments into all pensions you might have, including your employer's contribution.
The lifetime allowance
The lifetime allowance, which is set by the Government, is the total value of pension savings you can normally take from all your pension plans without paying a tax penalty.
If you've saved more than that, the excess may be subject to 55% tax if you take it as a lump sum - or 25% if you take it as pension income.
There are circumstances where you may have a personal Annual Allowance and/or Lifetime Allowance that is different. Please speak to your financial adviser for more details.