• Pension input periods don’t necessarily align with tax years.
• Each pension arrangement will have its own PIP.
• There can be only one PIP end date in each tax year per arrangement.
• Each PIP period is generally 12 months in length.
• The length of a PIP can be changed. Money purchase PIPs can be changed by the scheme administrator and possibly the individual. Defined benefit PIPs cannot be changed by the individual; these are determined by the scheme administrator only.
• The individual may be a member of more than one arrangement and could have more than one PIP. To work out if an individual’s pension saving exceeds the annual allowance for a particular tax year the pension saving for PIPs that end in that tax year is taken into account.

The First Pension Input Period of an arrangement

There are slightly different rules that govern the length first pension input period depending on whether it commences before or after 5 April 2011. In both instances, it will start on the date of the first relievable pension contribution made to the arrangement. A first pension input period commencing on or before 5 April 2011 will last for a year and one day (eg 1 June 2010 to 1 June 2011). First pension input periods commencing after the 5t April 2011 end automatically on 5 April of the same tax year, unless a nomination is made for it to end on a different date. A nomination for an end date after 5 April can be made after 5 April but the nominated end date cannot be a date before the nomination is made. The nominated date can be any date within 12 months of the start date of the pension input period.

In respect of any Skandia pension contract, Skandia will nominate the first pension input period end date to be 12 months after the start date of the first pension input period unless the member requests, at the time of the application, for an earlier end date. Further detail is available here.

It is important that you check with the scheme how the first pension input rules apply to the arrangement to make sure contributions paid in the first pension input period are set against the annual allowance for the tax year intended.

Richard set up a new personal pension on 13 October 2011 making a lump sum contribution of £2,000 to a scheme where the end date is automatically 5 April. The first PIP commenced on 13 October 2011 and ends automatically on 5 April 2012. The £2,000 contribution counts against the 2011/12 annual allowance.

Richard could nominate the PIP to end in the 2012/13 tax year by nominating any date up to

12 October 2012. This nomination can be made after 5 April 2012 but the nominated end date cannot be a date before the nomination is made.

If Richard had made that initial contribution to a Skandia Collective Retirement Account, the first PIP would end automatically on the 12th October 2012, thereby counting against the 2012/13 annual allowance. He could at the time of the application request that the PIP is terminated on or before 5th April 2012 to ensure that the contribution counts against the 2011/12 annual allowance instead.

Subsequent Pension Input Periods

Once the first PIP has ended the next PIP will commence immediately afterwards. It will automatically last until the anniversary of the end date of the first PIP, unless a nomination is made for it to end earlier or later. The nomination date must be a date in the tax year following the tax year in which the previous PIP ended in, and can’t be a date before the date the nomination is made.

Using the above example, Richard nominated that the first PIP will end on 1 July 2012. The second PIP will start immediately afterwards, on 2 July 2012, and will automatically end on 1 July 2013. Richard could not nominate an end date which fell before 6 April 2013 but could choose any date up until 5 April 2014 as long as the date chosen is on or after the date the nomination is made.