diff --git a/app/dao/annual_billing_dao.py b/app/dao/annual_billing_dao.py
index ffad11ade..2a593bfb1 100644
--- a/app/dao/annual_billing_dao.py
+++ b/app/dao/annual_billing_dao.py
@@ -58,34 +58,42 @@ def set_default_free_allowance_for_service(service, year_start=None):
         'central': {
             2020: 250_000,
             2021: 150_000,
+            2022: 40_000,
         },
         'local': {
             2020: 25_000,
             2021: 25_000,
+            2022: 20_000,
         },
         'nhs_central': {
             2020: 250_000,
             2021: 150_000,
+            2022: 40_000,
         },
         'nhs_local': {
             2020: 25_000,
             2021: 25_000,
+            2022: 20_000,
         },
         'nhs_gp': {
             2020: 25_000,
             2021: 10_000,
+            2022: 10_000,
         },
         'emergency_service': {
             2020: 25_000,
             2021: 25_000,
+            2022: 20_000,
         },
         'school_or_college': {
             2020: 25_000,
             2021: 10_000,
+            2022: 10_000,
         },
         'other': {
             2020: 25_000,
             2021: 10_000,
+            2022: 10_000,
         },
     }
     if not year_start:
@@ -93,8 +101,8 @@ def set_default_free_allowance_for_service(service, year_start=None):
     # handle cases where the year is less than 2020 or greater than 2021
     if year_start < 2020:
         year_start = 2020
-    if year_start > 2021:
-        year_start = 2021
+    if year_start > 2022:
+        year_start = 2022
     if service.organisation_type:
         free_allowance = default_free_sms_fragment_limits[service.organisation_type][year_start]
     else:
diff --git a/tests/app/dao/test_annual_billing_dao.py b/tests/app/dao/test_annual_billing_dao.py
index 4fa0954c6..de91048de 100644
--- a/tests/app/dao/test_annual_billing_dao.py
+++ b/tests/app/dao/test_annual_billing_dao.py
@@ -66,7 +66,12 @@ def test_dao_update_annual_billing_for_future_years(notify_db_session, sample_se
                           ('other', 2020, 25000),
                           (None, 2020, 25000),
                           ('central', 2019, 250000),
-                          ('school_or_college', 2022, 10000)
+                          ('school_or_college', 2022, 10000),
+                          ('central', 2022, 40000),
+                          ('local', 2022, 20000),
+                          ('nhs_local', 2022, 20000),
+                          ('emergency_service', 2022, 20000),
+                          ('central', 2023, 40000),
                           ])
 def test_set_default_free_allowance_for_service(notify_db_session, org_type, year, expected_default):