Stakeholder Pension Plan- Am i getting full tax reliefs?

CDB199

I am a higher rate tax payer (earnings around 60k per annum) and contribute around 6k per year into a Halifax stakeholder pension.

I know that the basic 20% tax relief is collected by the pension company, and thought that by sending HMRC my contribution notice, that i would in return gain the higher rate relief. I used listentotaxman to confirm this.

However, i have had my tax calculations back from HMRC and they are suggesting that i have underpaid and now i owe them. (this will be paid during 2010/11 PAYE)

Can anyone confirm this is correct and show some workings?

Do i need to get back in contact with HMRC or even the halifax pensions to let them know i am a higher rate tax payer?

Slightly confused and hope someone can enlighten me. thanks in advance CDB199

dunstonh

I am a higher rate tax payer (earnings around 60k per annum) and contribute around 6k per year into a Halifax stakeholder pension.

First thing is... You have picked a pretty awful provider and pension product. You can do so much better. You made a sales rep at Halifax very happy but you shouldnt be.

As a higher rate taxpayer you probably do a self assessment form each year. There is a box in there for you to put your pension contributions. If you dont fill in a self assessment form you need to notify HMRC of your pension contributions, They wont know unless you tell them.

lvader

dunstonh wrote: »

First thing is... You have picked a pretty awful provider and pension product. You can do so much better. You made a sales rep at Halifax very happy but you shouldnt be.

As a higher rate taxpayer you probably do a self assessment form each year. There is a box in there for you to put your pension contributions. If you dont fill in a self assessment form you need to notify HMRC of your pension contributions, They wont know unless you tell them.

Unless you are earning over £100'000 or have other income there really is no need to do a tax return for getting back high rate tax relief on pension contributions. Just call the tax office and they will add it to your tax code. It sound like the tax man isn't aware of your pension contiibutions or you over estimated the payments but have the tax code already ammended. Just call then up to sort it out.

CDB199

I sent off all my pension contributions to the HMRC a month ago stating the end of year payments - how much i invested for the last tax year.

Surely this would be enough for them to do what they have to do? Instead, they are claiming i owe them for tax underpaid!

I was expecting (in all honesty) to be given money back. Have they ignored what i sent to them?

CDB199

dunstonh....i picked "a pretty awful provider and pension product."

tell me more?

lvader

CDB199 wrote: »

Surely this would be enough for them to do what they have to do? Instead, they are claiming i owe them for tax underpaid!

Did you reduce your pension paymemnts compared to last year? That could be one reason. These sorts of things are much easier to clear up over the phone, just give them a call.

dunstonh

CDB199 wrote: »

dunstonh....i picked "a pretty awful provider and pension product."

tell me more?

You are on a full cost stakeholder when a personal pension is almost certainly much cheaper. Halifax investment funds tend to be poor quality as well (consistently).

CDB199

Maybe you could send me a note with some ideas of personal pensions i could pay into.

CDB199

when i call up the HMRC they say that the amounts i paid into last year (not reduced, just increased in line with earnings index) are such that they cannot deal with over the phone but have to be in writing. maybe i will call them again....