I'm trying to understand how to calculate how much money I can pay into pensions this year. I understand how to calculate the annual allowance, which isn't the problem: instead, I need to understand how to avoid contributing more money than I have earned.
The issue is in calculating the contributions to my defined benefit pension. Here is a simple example using made up numbers: if I earn 30,000 per year before tax or NI, and contribute 300 per month to a defined benefit pension, I would naively think that this would leave 30,000 - 12*300 = 26,400 that I could contribute to a SIPP.
However this doesn't take account of my employer's contributions, or of the defined benefit. For the annual allowance calculation, the contribution numbers don't matter; instead I take the change in the annual benefit and multiply it by 16. Is this what I need to do here, or do I do the calculation above, or do I do something different to either of these?