The AA charge is not a fixed rate but will depend on:
- how much taxable income you have
- the amount of your pension savings that exceed the AA
To find out how much you’ll pay, you must work out the rate of tax that you would be charged if your excess pension savings were added to your taxable income and based on your marginal income tax rate.
We cannot advise on the calculation of your AA charge.
If you have an AA charge, you must tell HM Revenue & Customs (HMRC) about your pension savings and liability to the charge.
Use the HMRC calculator to check if you have an AA tax charge on your pension savings.
How to pay the AA charge
You’re responsible for making arrangements to pay your AA charge to HMRC.
You can either:
- pay, all or part of the charge, directly to HMRC
- ask us to pay, some or all of the charge, for you using our Scheme Pays facilities
If you pay the charge yourself, it’s payable as part of a self- assessment tax bill.
You must pay the charge to HMRC by their 31 January deadline.
They may ask you to pay interest if your payment is late.
If we’re paying any of your AA by voluntary Scheme Pays, this must be paid by 31 January.