Annual Allowance: Who’s requested their updated NHS pension statement?

We regularly remind doctors and dentists how important it is to keep an eye on their annual pension allowance, yet still many are oblivious to how breaching your annual pension allowance can massively increase your personal tax bill!NHS Pension statements - have you requested yours?

It’s time to request your NHS pension statement

From October 6th each year onwards you can request your most recent NHS pension statement, showing your pension growth in the previous tax year. Obtaining this statement will help you with your tax planning. As any GP partners and dentists are aware, annoyingly their figures are typically a year behind the most recent tax year.

A quick recap on annual allowance

The government sets your annual pension allowance limit. Your annual allowance is the amount of pension savings an individual can make in one tax year before receiving a tax bill. The standard annual allowance limit is £40,000 and it is the GROWTH in your NHS pension benefits that are assessed against this figure – NOT your total contributions.

If you are deemed to be a ‘high earner’ (those with an income in excess of £200,000) then your allowance may be tapered down. It’s a sliding scale, but worst case you could end up with an allowance of just £4,000, reduced down from £10,000 in April of this year.

Remember: The NHS only has to inform you if you have breached the £40,000 allowance. They are not always aware if you have suffered tapering and consequently have a lower allowance. So, it’s in your best interest to acquire your annual allowance figures. 

How do I get my NHS Pension Statement?

You can request your NHS pension statement to be sent out by post, which can take up to 12 weeks. It is not the fastest process in the world but it’s always good to have a paper copy. Historically you could obtain these figures over the phone, but due to call volumes this service has been removed. 

Upon receipt of your NHS pension statement, it is important to carry out a sense check to see if you can spot any obvious errors. We recommend you pass them to your adviser and accountant as soon as you can to give them as much time as possible to look at the situation.

Having the NHS pension growth figure is only one step in the process.

The NHS figures will not take into account personal pension contributions made or other scheme benefits accrued elsewhere – for example, a military pension relating to membership of the army reserve.

For personal pensions, unlike the NHS scheme, you simply use the gross contributions actually paid rather than any more esoteric calculation based on growth.

Once you have all the figures you can use them along with the previous three year’s figures to see if you have a liability for additional tax.

Warning: Good news to follow

Tapering annual allowance

Changes to tapering annual allowance came into force last April. The change saw the income threshold increased to £200,000. This means anyone who earns under this will not be affected by the tapered annual allowance.

The annual allowance will only begin to taper for those who have an income above this.

Before this change, the minimum annual allowance you could have was £10,000, but this reduced to £4,000.

Are you subject to tapering your Annual Allowance? Let’s check:

The key is knowing your ‘Threshold’ and ‘Adjusted’ incomes. As of April 6th, 2020, you have a tapered annual allowance if:

  • your threshold income is over £200,000 (previously £110,000)
  • your adjusted income is over £240,000 (previously £150,000)

You won’t be subject to the tapered annual allowance if your threshold income is £200,000 or less, irrespective of what your adjusted income is, so check that first!

What is the difference between the 2 incomes?

In a nutshell ‘threshold income’ is all of your earnings (not just your salary) including chargeable gains on investment bonds (to be clear that’s the whole gain, not just the ‘top slice’ – speak to your adviser if you need to understand the difference). However, all UK pension contributions are not included.

‘Adjusted income’ is all of your earnings which are subject to UK Income Tax, including all pension contributions paid by you or your employer.

You still need to assess the past years using the prevailing rules in those years even if by some minor miracle this headache goes away for you in the future.

If all this information leaves you scratching your head and not knowing where to start, then you are not alone! This is where a financial adviser can help.

Legal and Medical are specialists in the NHS pension scheme and we can help you navigate your way through the minefield. Everyone’s circumstances are different. We can carry out an analysis of your individual situation and provide you with forecasts and a report summarising your situation.

This is a fixed-fee service, so no nasty shocks there either! So please don’t leave an annual allowance tax bill to chance – do get in touch!

Are you going to request your NHS pension statement yet? Let us know by adding a comment below.

6 thoughts on “Annual Allowance: Who’s requested their updated NHS pension statement?

  1. Tom W

    Have just telephoned NHS pensions. They ‘no longer issue these figures over the phone’. Unfortunately I am now facing a large annual allowance tax bill and am no able to confidently take action for this year as I will not be able to access the information with enough time left in the financial year to do so. I will make sure to request these figures in advance from now going forward but it is fantastic that when these figures have become so important they have been made even harder to get hold of. Another example of valuing NHS staff.

    1. Owen Beswick

      Hi there

      We have had the same experience and entirely agree with your sentiments. Moving forward we are suggesting to all our clients that they request an annual allowance statement. The only issue is when to do it? Our information is that employing trusts should have produced information for hospital-based clinicians (not general medical practitioners) by the end of May and that this information should then be acted upon to enable statements to be produced at the beginning of October.

      However, if an individual asks for information too early (before June/July for example) they are likely to be met with “we haven’t received the figures”.

      But ask too late (September/October) and the NHS, if they conform to their self-imposed service level of 3-month turnaround, is unlikely to get a statement to the individual before it’s required ie. by the end of January! Therefore, by a process of elimination, it seems that the best time to ask is in July when the pensions agency should have the figures to produce a statement.

      An individual request will be actioned within three months, taking individuals up to the end of October. If the NHS hasn’t actioned the request in this time period, they have 10 days (under their own rules) to escalate the request and provide a statement.

      It should be said that my experience is that they tend to hit this target within 15 days. At least doing it this way should mean you will have a statement by the middle of November!

      I hope this helps,

      Best wishes, Owen

  2. Rachel M

    I must be doing something wrong! I have had zero success with obtaining the annual allowance statement for 18/19 let alone 19/20. I have rung 4 times since January 2020 according to my file notes and each time was told they would put in a request for the statement to be sent and it should arrive in the post within 3 months. The only upside is that they are always terribly nice and apologetic about it all.
    Frustrating though as no doubt if there is a tax bill to pay it will now be plus interest.

    1. Owen Beswick

      Hi there

      This particular department within the NHS is under huge pressure and we have seen the “3-month” turnaround slip. The only way of getting around this situation is to request a statement in August of every year. That way, in our experience you will have your statement by the end of December.
      I don’t foresee the backlog getting any better!

      In relation to your individual situation I would urge you to meet up with one of our advisers; if you have a tax charge in the 2019/20 year this can be claimed from the NHS through Scheme Pays and it will NOT reduce your future pension. This is for this year in isolation. One of our advisers will be able to generate a report that will give you a good idea of what your inputs are without the annual allowance statement. They will need information like your total rewards statement, payslip , accounts etc but they will be able to do a calculation.

      Please do get in touch.

      Best wishes, Owen

  3. ELAINE Snowball

    My Pension forecast for 2020 was way different to my forecast for 2016 when I looked at the wage they were basing this on it was £14,600 more than the full time equivalent for my pay band. This literally makes tousands of pounds difference to my pension and lump sum. I am now going to have to try and obtain another statement with correct pension details on as I am planning to do flexi retiremnet this year.
    It pays to check your statement regularly. NHS pensions are blaming my payroll as the info on your wages are supplied by them. Extremely frustrating doesn’t even begin to cover it.

    1. Owen Beswick

      Hi Elaine

      Could you email me directly ( and we can chat this through? I’m not sure if your pension is more or less than expected – I am assuming less! I also assume that superannuated (inclusion or not) CEA’s are not the reason for a discrepancy in figures (CEA’s before April 2018 were superannuated). You sound as if you have a good handle on your situation, albeit the information that you have is misleading. But, I am assuming that you have taken into account Standard, Non-Standard benefits, lifetime allowance etc etc. I do find that a significant number of new clients, who are contemplating retirement, have not looked at what their NHS pension was “worth” in April 2016, for instance, and as such they are potentially missing out on applying for a protected lifetime allowance (IP 2016) for instance. The net result of which, will be a larger pension!

      Please do get in touch.

      Best wishes, Owen


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