How long does it take to get pension tax relief from SIPP

donblount

I am planning to open a SIPP. I am trying to clear up some questions I had regarding exactly how I would get the tax reliex.

Most SIPPs will immediately give you a 20% tax relief. Is this 20% tax relief available immediately in your account?

My marginal tax rate is more than 20%. So I am planning to write to HMRC asking for tax relief for the larger amount? How long does it normally take to get the tax relief from HMRC. Few days or weeks? Also is the extra tax relief applied to your pension account or do you get that in cash in your normal bank account ?

BoGoF

Not sure about when the initial 20% relief is applied by the SIPP provider but with regards the higher rate relief from HMRC, if you pay the contribution this tax year your tax code will be adjusted to account for this meaning you pay less tax.

Thrugelmir

On my SIPP the basic rate tax relief is credited to the account the month following the contribution.

dunstonh

If it is pre funded by the SIPP provider then it is immediate. If the SIPP provider doesnt have the funds to offer that feature then a couple of months at most.

The extra 20% from Higher rate relief is done via your tax return of tax code (if you pay regular and you ask for it that way)

westy22

Hargreaves Lansdown have a Contribution calendar on their SIPP which shows exactly on which day the tax relief will be invested following your contribution - it is approximately 6 weeks later.

SippTechie

The reclaims are all done on a consolidated tax month basis using a calendar imposed by HMRC.

An example of the timetable for those which aren't pre-funded by the provider is:

Individual pays contribution to the SIPP in the tax month 6th January to 5th February.

SIPP provider must submit consolidated tax return to HMRC for all individual contributions paid in the above tax month by the end of February.

HMRC pays tax relief to SIPP provider on 21st March.

SIPP provider moves money into individual accounts on or very shortly after 21st March.