If you’ve recently received a letter in the post titled Pension Savings Statement (PSS), it’s important to understand what it means — and what action you may need to take.
What Is a Pension Savings Statement?
A PSS is issued by your pension scheme when they believe your pension growth has exceeded the annual allowance in a given tax year.
The annual allowance is the maximum amount of tax-free pension growth an individual can have in one year. For most people, pension growth stays well within this limit — so if you haven’t received a statement, there’s likely no issue.
However, higher earners, those with significant pay increases, or individuals with long service in older final salary schemes (such as the 1995 NHS scheme) may be affected. How Will I Receive It?
- PSS documents are sent by post only — they are not available online.
- They are typically issued by 6 October following the relevant tax year, but delays are common.
- Letters are sent second class via Royal Mail, so allow up to two weeks for delivery.
What Should I Do If I Receive One?
⚠️ Receiving a PSS doesn’t automatically mean you owe pensions tax — but it does mean you need to check your position carefully.
You may be able to:
- Offset the excess using unused allowance from previous years
- Avoid a tax charge altogether depending on your circumstances
However, this requires a detailed review of your pension growth and allowances, and the scheme won’t do this for you. It’s your responsibility to understand the figures and take action.
Why Might More People Be Affected This Year?
Although the annual allowance has increased in recent years, the consultant pay uplift in the NHS from the 2024/25 tax year means more individuals may now breach the threshold.
This could result in a spike in PSS letters for NHS members — especially consultants — even if they’ve never received one before.
Additional Considerations
If your taxable income exceeds £200,000, your annual allowance may be reduced (known as tapering). In this case, you may need to request a PSS manually, which can take up to three months to arrive.
- If you’re contributing to multiple pension schemes, you may also need to request a statement to ensure your total pension savings are within the limit.
Declaring Tax Charges
If you do have an annual allowance tax charge, it must be declared on your self-assessment tax return. The deadline for this is 31 January 2026.
Need Help?
Understanding your PSS and calculating any potential tax charge can be complex — especially if you’re affected by tapering, multiple schemes, or transitional protections.
We offer a dedicated support service to help you:
- Interpret your PSS
- Assess your annual allowance position
- Explore scheme pays options
- Prepare for self-assessment
Don’t ignore your PSS. It’s your pension scheme’s way of alerting you to a potential tax issue — and taking timely action could save you money and stress.
#AnnualAllowance #PensionTax #NHSRetirement #PSS #FinancialPlanning #SchemePays #TaxSupport #ConsultantPayReview