That all-important April 5th deadline is fast approaching, and many pension planners will be looking at shoring up their strategies before their annual limits for tax-free contributions reset ahead of the new tax year. But what moves should you keep in mind before April arrives?

Each tax year is vital for pension savers because they stipulate when contribution limits refresh for the next 12 months, which allows savers to boost their tax relief and better manage their liability.

If you miss the April deadline, you’re at risk of losing the chance to use your allowance for the year to its fullest potential, as well as the ability to carry forward unused allowances from previous years.

Your strategies should focus on maximising your £60,000 annual pension allowance, utilising carry-forward rules from the previous three years, and assessing your salary sacrifice options as a way to further boost your tax efficiency.

With this in mind, let’s explore three essential pension planning moves for you to consider before the end of the tax year.

1. Make the Most of Your Annual Contributions

The single most important thing to keep in mind when a new tax year is approaching is your annual contributions. You can typically contribute up to £60,000, or 100% of your earnings, depending on what’s lower, into your pensions and gain tax relief as a result.

By the 6th of April, if you haven’t used your allowance, it can’t be carried forward into the new year. The end of the tax year is effectively your last chance to use your allowance to lower your income tax bill.

For higher-rate taxpayers, you can access significant levels of tax relief from your annual contributions, so it’s certainly worth taking a moment to check whether you have room to contribute more to reach your allowance limit before April arrives.

Making the most of your annual contributions without running the risk of causing yourself to become financially less comfortable in the short term is key, and using tools like Wealthify’s SIPP Pension Calculator can be a major help in planning your contributions to reach your future goals.

2. Carry Forward Unused Allowances

The end of the tax year can also be a great time to check on your ability to carry forward any unused annual allowances over the past three tax years.

Depending on your circumstances, you could be able to carry forward your spare allowance to increase your total contribution capacity for the current year.

This option is a particularly useful approach if you’re a high-income earner or have received a large bonus in the new year.

You’re usually able to carry forward if you were a member of a registered pension scheme during any of the past three tax years that you want to carry forward, not including the State Pension.

You’ll also be eligible as long as you haven’t triggered the money purchase allowance (MPAA) by taking taxable money flexibly from a defined contribution pension.

If the current tax year has seen you receive a large amount of money that you’d like to contribute to your pension, the carry forward rules mean that you can access a higher total allowance before April.

If you wait until the 6th of April or later, you may not be able to make the most of your unused allowance, depending on your contributions in recent years.

3. Explore Salary Sacrifice Options

Salary sacrifice schemes work closely with tax years because they can be used to lock in tax and National Insurance (NI) savings for the current year while also utilising annual tax allowances and managing tax brackets more strategically.

If you’re concerned about your level of income tax positioning you in a higher tax bracket during the tax year, speak to your employer about swapping part of your salary for an employer pension contribution.

This can help to either lower your tax band or keep you at your current level for longer. As a result, both you and your employer can save money on NI.

You should also keep in mind that the government is set to introduce a £2,000 cap on salary sacrifice for pension contributions starting in April 2029.

As a result, it may be worth looking to take the opportunity to make the most of salary sacrifice without limits over the coming years.

Preparing for the New Tax Year

With just a few more weeks to go until the beginning of April, it’s worth taking a look at the ways you can make the most of your pension before the new tax year begins.

Whether you can squeeze more out of your allowance, make the most of unused old allowances, or make use of salary sacrifice options, there are plenty of ways to boost your pension in a way that suits your financial goals.

Always remember to avoid overreaching when it comes to saving, and if you’re worried that your contributions could cause you to feel financially less comfortable, it’s always best to err on the side of caution.

However, strategising ways to get more out of your pension today can make all the difference when you reach retirement age.