You can put as much money as you'd like into your pension, but there arethree limits to the amount you can get tax relief on.
While you're earning, you can put in 100% of your earnings up to amaximum of £60,000 each yearand qualify for tax relief. Above that, you’ll face a tax charge. This is also known as the annual allowance.
If you earn more than £260,000 a year, the amount you can put in tax-freegradually reduces. For every £2 earned over £240,000, the amount you can contribute reduces by £1 until the annual allowance reaches £10,000.
If you'renot earning money, you can still put £2,880 a year into your pension and gettax relief of £720added, which means you can add £3,600 a year to your pot free of income tax.
There used to be something called alifetime allowanceon your pension, but this has now been scrapped. However, if you accessed your retirement savings before April 6, 2023, the old rules still apply and you’ll need to pay a tax charge if your pot was worth more than £1,073,100.
Finally, the amount you can pay in whilst still benefiting from tax reliefdrops dramatically as soon as you begin withdrawing moneyfrom your pension. Once you've started drawing on your SIPP, the annual limit immediatelyfalls to £10,000.