(Section 307 ITEPA 2003)
Certain benefits made available by to employees are not chargeable to tax. Principal among these is the provision of a pension to an employee, his family and dependants, using a registered pension scheme. If the annual contributions exceed £50,000 (for 2011/12), the excess is chargeable at the employee’s marginal rate. This limit can be extended by unused allowances brought forward from previous years; the annual allowance for previous years is assumed to be a maximum of £50,000 rather than the greater limits that actually applied then.
