Stakeholder pension 40% tax rebate.

macca608

Hello there,
I am currently in a stakeholder pension plan where my company pays in 5% and I pay 5%. I understand the companies 5% tax is not my concern. I have had my tax code adjusted to suit but my calculations have discovered this is based on a 22% rebate. As a proportion of my income is taxed at 40% am I entitled to a corresponding proportion of tax relief on pension contributions at the same 40% rate? I have contacted my tax office and they were very vague in their response! This has been going on for some years now. If I am entitled some tax relief at 40% how far back can I claim for and how do I go about it?? Its better in my pocket than theirs!!

sarahlouise210

The payments you make to your Stakeholder pension have already received tax relief at the basic rate before you make your payments - for example for every £78.00 you pay - £100 is invested for you. The amount you areciving through your tax code is the additional tax relief die to you as your highest tax rate is 40%. As you say you have had al allowance in your code relating to this pension then you will probably have had all the tax relief die to you (assuming the allowance in your code was correct) Post your calculations - your payments and your tax allowance in your code and we will check it for you.

isasmurf

Just to clarify what sarahlouise said. You pay your 5% pension contribution, and your stakeholder pension will automatically reclaim 22% tax relief for you and invest it in your fund. The other 18% of the tax relief you can claim through a self assessment form or an adjustment of your tax code.