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NHS Financial Planner

NHS Pension Carry Forward Guide

Complete guide to Carry Forward rules for NHS pension scheme members. Learn how to use unused Annual Allowance from previous years.

Last updated: 2026-03-30
All Resources

Carry Forward Tools & Guides

Carry Forward Calculator

Calculate your available unused allowances

Annual Allowance Guide

Understand the main allowance rules

Tax Planning Guide

Strategic pension tax planning

Carry Forward Timeline

1

Current Year (2026/27)

Use £60,000 allowance first (or tapered amount)

2

2025/26

Up to £60,000 unused allowance available

3

2024/25

Up to £60,000 unused allowance available

4

2023/24

Up to £60,000 unused allowance available

What is Carry Forward?

Carry Forward allows you to use any unused Annual Allowance from the previous three tax years. Key points:
•Standard Annual Allowance is £60,000 (2026/27)
•Can look back up to three tax years
•Must use current year's allowance first
•Must have been a member of a UK pension scheme in the year from which you wish to carry forward
•Particularly valuable for NHS staff with significant pension growth
This can help you make additional pension contributions or manage tax charges from high pension growth.
Source: https://www.gov.uk/guidance/check-if-you-have-unused-annual-allowances-on-your-pension-savings

How to Calculate Unused Allowance

To calculate your unused Annual Allowance:
1. Current Year (2026/27):
• Start with £60,000 standard allowance
• Subtract pension growth for current year
• Must use current year's allowance first
2. Previous Three Years:
2025/26: Up to £60,000 available
2024/25: Up to £60,000 available
2023/24: Up to £60,000 available
Important Notes:
•Tapered Annual Allowance affects available amounts
•McCloud remedy choices may affect historical calculations
•Must have been in a pension scheme each year
Source: https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm055100

Impact of Tapering

Tapered Annual Allowance affects Carry Forward calculations:
Historical Tapered Amounts:
2023/24 to 2026/27:
•Threshold Income: £200,000
•Adjusted Income: £260,000
•Minimum allowance: £10,000
2020/21 to 2022/23:
•Threshold Income: £200,000
•Adjusted Income: £240,000
•Minimum allowance: £4,000
When calculating Carry Forward:
•Must use the tapered amount for each year if applicable
•Cannot carry forward more than the tapered amount
•Keep records of threshold and adjusted income calculations
Source: https://www.gov.uk/guidance/pension-schemes-work-out-your-tapered-annual-allowance

When to Use Carry Forward

Common scenarios for using Carry Forward:
1. Significant Pension Growth:
• Promotion or pay increase
• Additional sessions/overtime
• Multiple NHS roles
• Clinical Excellence Awards
2. Additional Contributions:
• Making up for career breaks
• Increasing retirement benefits
• Tax-efficient saving
3. Managing Tax Charges:
• Reducing or eliminating AA charges
• Planning for known pension growth
• Strategic retirement planning
Source: https://www.gov.uk/guidance/check-if-you-have-unused-annual-allowances-on-your-pension-savings

Record Keeping

Essential records to maintain:
1. Annual Documents:
• Pension Savings Statements
• P60s and payslips
• Self-assessment returns
• Pension growth calculations
2. Historical Information:
• Previous years' allowances
• Tapered AA calculations
• Scheme Pays elections
• Pension input amounts
3. Supporting Evidence:
• Promotion letters
• Additional role contracts
• Clinical Excellence Awards
• Any correspondence with NHS Pensions
Source: https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm055100

Common NHS Carry Forward Traps

Current year first

Carry forward only helps after the current year allowance has been used. Do not offset previous years before checking the current-year PIA.

Tapered years stay tapered

If a previous year was tapered, you can only carry forward unused allowance from that reduced figure, not automatically the full standard allowance.

Scheme membership matters

You generally need to have been a member of a registered pension scheme in the year you want to carry forward from, even if pension growth was low.

Opt-out years need evidence

Fully opted-out years may leave the annual allowance unused, but keep evidence of the opt-out period and any other pension saving in that year.

Worked planning example

If your current-year PIA is £82,000 and your untapered annual allowance is £60,000, the first £60,000 is covered by the current year. The remaining £22,000 can then be tested against unused allowance from the previous three years.

If you have £10,000 unused from 2025/26 and £15,000 unused from 2024/25, carry forward could remove the charge. If you were tapered in those years, the unused amounts need to be recalculated using the tapered allowance for each year.

Record Keeping Essential

Carry Forward requires detailed record keeping of previous years' pension growth and allowances. Keep all Pension Savings Statements, P60s, and documentation of promotions or additional work that affects your pension growth.

Continue your planning journey

These related guides cover the next questions that usually come up after this topic.

Annual Allowance

Understand the PIA and taper before applying carry forward.

Read next

Scheme Pays

Know the payment route if carry forward does not remove the charge.

Read next

McCloud Remedy

Check whether remedy-period figures change historical allowances.

Read next

Required Actions

1

Gather historical data

Collect pension statements and growth information for previous three years

2

Calculate unused allowances

Determine available carry forward from each qualifying year

3

Plan strategically

Use carry forward to manage expected pension growth or make additional contributions

4

Seek professional advice

Consider financial advice for complex carry forward situations