Scheme Pays

Paying tax on pension savings over the Annual Allowance limit

If your pension savings go over the Annual Allowance (AA), you may have to pay a tax charge.

'Scheme Pays' is a mechanism by which the AA tax charge can be paid out of a pension scheme, rather than by the member directly.

The Scheme Pays leaflet below includes more information about: 

• Why you would have to pay a tax charge
• How you can pay the tax charge
• How much tax you will have to pay
• When the ‘Scheme Pays’ option can be used
• How you use the ‘Scheme Pays’ option
• How your benefits would be reduced under the ‘Scheme Pays’ option

If you want to go ahead with Scheme Pays you will need to complete an application form.

You can get a Scheme Pays application form by contacting the Scheme administrator, Railpen. 

Please make sure you leave enough time to request and return your completed application form ahead of any application deadline.