If you exceed the Annual Allowance and a tax charge is due, you can ask us to pay the charge on your behalf in exchange for a reduction in your benefits. This is called Scheme Pays.
There are two types of Scheme Pays: Mandatory and Voluntary.
Can be used if all three of these criteria apply to you:
Members with a tapered (reduced) Annual Allowance must have a Pension Input Amount in excess of £60,000 in one particular scheme (for example, alpha or classic) to use Mandatory Scheme Pays for part of their tax charge.
For members with current benefits in both the Principal Civil Service Pension Scheme and alpha, if their Pension Input Amount in each scheme exceeds £60,000 then they may be able to use Mandatory Scheme Pays to pay the tax charge for one scheme. The remaining scheme would be paid on a voluntary basis. This facility would not be available for those with tapered Annual Allowance wishing to use Scheme Pays for their entire tax charge.
Voluntary Scheme Pays can be used if:
If you decide to use Scheme Pays, you’ll need to advise HM Revenue & Customs (HMRC). This should be done via your self-assessment.
To prevent any late payment charges being imposed by HMRC, we encourage you to take note of the Scheme Pays deadlines which can be found in the table below.
Any Scheme Pays quote request received after 18 November 2025 will still be processed, but payment of tax by 31 January 2026 cannot be guaranteed
| Action | Deadline date |
|---|---|
| You recieve a Pension Savings Statement | By 6 October 2025 |
| Complete the Scheme Pays quote request form | By 18 November 2025 |
| We issue you with your Scheme Pays quote | By 9 December 2025 |
| If you decide to go use Scheme Pays, you should complete and return your Scheme Pays form accepting the quote | By 23 December 2025 |
| We process your Scheme Pays deductions | By 14 January 2026 |
| You should notify HMRC that you have a tax charge owing and inform them of your intention to pay it using Scheme Pays | By 31 January 2026 |
| If you’re using Voluntary Scheme Pays, we’ll pay your tax charge (assuming all deadlines are met, or on the next AFT if later). | By 31 January 2026 |
| If you’re using Mandatory Scheme Pays, we’ll pay your tax charge (or on the next AFT if received before this date). | By 14 February 2026 |
Please note: you won’t be able to withdraw your application once we’ve received your acceptance form. However, we will accept revisions to the tax charge, amend your record and reclaim any overpaid tax if required. At this point, we’ll adjust your benefits accordingly and pay the tax charge to HMRC on your behalf.
If you have a tax charge due, you’ll need to follow the HMRC guidelines for calculating, declaring and paying.
You can also use HMRC calculator to help work out if you have a taxable breach.
Read the information about Annual Allowance and Scheme Pays on the HMRC website.
Scheme Pays quote request form
The adjusted income limit is £260,000 and the minimum Annual Allowance can be decreased to is £10,000.
Adjusted income is not based on your salary alone, if you have other sources of income you may need to include this when calculating your adjusted income.
How to calculate adjusted income and tapered Annual Allowance.