Tax allowance and pension contributions

dibdabable

I decided to put this here instead of on the Pensions Thread. Basically my OH has an NHS Pension which is paid from gross, so obviously before tax is deducted. Tax and N.I Contributions are paid through PAYE .
However OH has purchased some additional pension, through the same NHS Pension but OH decided (as it's cheaper) to pay for the additional pension with a lump sum, rather than have it taken monthly from their wage.

I have looked here; http://www.hmrc.gov.uk/incometax/relief-pension.htm

I am wondering what the tax position is here, given that the contribution won't have been taken from gross pay. Is there anything to claim back here or is that wishful thinking! Does it depend on where the lump sum came from etc? Thanks.

CLAPTON

if it is paid from taxed income (unlike his monthly NHS contibutions) then the pension company reclaims 20% tax on his behalf ; so for every £100 he pays, the pension company claim £25 from the government.

so if he is a 40% tax payer then he needs to reclaim the extra (20% ) from HMRC otherwise he need do nothing.

dibdabable

Thanks for your response, in the meantime I had found this on here, which seems to be different to your response.

https://forums.moneysavingexpert.com/discussion/3493167

Hopefully someone may be able to give additional info.

jem16

dibdabable wrote: »

Thanks for your response, in the meantime I had found this on here, which seems to be different to your response.

https://forums.moneysavingexpert.com/discussion/3493167

Hopefully someone may be able to give additional info.

As I said on the other thread you have just linked to, public sector Additional Pension payments should be made gross and then you reclaim the tax relief from HMRC.

AVCs would be dealt with as Clapton says.

AirlieBird

You will need to claim all the tax relief on the additional pension yourself. The NHS pension is not a RAS (Relief at Source) scheme so what Clapton says is not applicable in this case.

See http://www.nhsbsa.nhs.uk/1289.aspx for more info.

dibdabable

Thanks. I think in the NHS anyway you can only now buy Additional pension rather than AVC's not that makes any difference here.

Okay so presuming that my OH can get Tax relief, how much say do you get in determining how that comes. FoR example in the thread I've mentioned someone had a cheque for the full amount, the other poster had it through his Tax Code. As it was a relatively large Lump Sum my OH paid it would be more beneficial to receive it in a lump sum.

Also I'm guessing also from the previous thread, in either case it's up to the individual to chase up the Relief and it won't be dealt with automatically by the Wages Dept.

dibdabable

AirlieBird wrote: »

You will need to claim all the tax relief on the additional pension yourself. The NHS pension is not a RAS (Relief at Source) scheme so what Clapton says is not applicable in this case.

See http://www.nhsbsa.nhs.uk/1289.aspx for more info.

Thanks. Our posts crossed, so that's good to know.

jem16

dibdabable wrote: »

Thanks. I think in the NHS anyway you can only now buy Additional pension rather than AVC's not that makes any difference here.

AVCs are still available in the NHS.

http://www.nhsbsa.nhs.uk/Pensions/2661.aspx

Okay so presuming that my OH can get Tax relief, how much say do you get in determining how that comes. FoR example in the thread I've mentioned someone had a cheque for the full amount, the other poster had it through his Tax Code. As it was a relatively large Lump Sum my OH paid it would be more beneficial to receive it in a lump sum.

If you want a cheque refund then simply ask for it and say you don't want it through your tax code.

dibdabable

That's great thanks.
Just to add a spanner to the works. OH was going to work this contribution as a loss, in TC825.

If OH does this, will OH have basically reclaimed the loss that way and then one presumes wouldn't be liable for a Tax Rebate as well, otherwise OH would effectively be claiming twice, is that right.
Hope that makes sense.

BoGoF

jem16 wrote: »

AVCs are still available in the NHS.

http://www.nhsbsa.nhs.uk/Pensions/2661.aspx



If you want a cheque refund then simply ask for it and say you don't want it through your tax code.

If the payment was made in the current tax year then you will need wait till after the end of the tax year if you want a cheque.

A coding adjustment in Month 12 will give the same refund as a cheque, only quicker. But you will need to be quick to get the tax code issued in time.

BoGoF

dibdabable wrote: »

That's great thanks.
Just to add a spanner to the works. OH was going to work this contribution as a loss, in TC825.

If OH does this, will OH have basically reclaimed the loss that way and then one presumes wouldn't be liable for a Tax Rebate as well, otherwise OH would effectively be claiming twice, is that right.
Hope that makes sense.

Eh?...........lost me know!