Please help with NHS Pension Purchase and Tax Relief

dibdabable

I am so frustrated and getting nowhere and am going to be so disappointed if I'm wrong but anyway.
My husband made a purchase of Additional Pension in the NHS Scheme. He made the payment with his savings and we were told by the NHS that he would need to apply for a Rebate of Tax directly from the HMRC. I wrote to the HMRC in February and explained very thoroughly what the payment was, the fact that it hadn't had relief of Tax and what paperwork they would need from my husband. They replied telling us yes we would be due a refund and we were to send his P60, the Receipt and statement from the NHS confirming the amount purchased and that it was a lump sum payment. We waited a very long time and heard nothing, we rang today and my husband handed the phone to me as he needed to return to work.The woman confirmed they had received the paperwork from us. As other Forum users have said in the past, I was told we'd only be due a refund if he was a higher rate tax payer.
See here;https://forums.moneysavingexpert.com/discussion/3493167

I have read on several ocassions that this is not the case and that as this is a Final Salary Scheme Relief will not be taken at source. I tried to give everything I knew about it to the woman, but she argued I was wrong and referred me to her manager, after waiting 10 minutes I'd been put through to Inheritances Taxes and couldn't be referred back to the same woman.So I had to end the call.
We are toying between phoning again and/or writing, but if we write will that letter marry up with the paperwork they already have and how much longer will that take.
My question is can anyone point me to any evidence that we are correct to claim this Rebate. I need something in writing to prove to the next person I speak to, it's no good just saying I know I'm right. From what I could tell the call handler was responding from a set of answers, so I need to be able to say, this is correct because of this this and that. Please help we are fed up with waiting. We've already waited over 2 months with no response from them it now looks like it will be even longer.

xylophone

http://www.nhsbsa.nhs.uk/1289.aspx
"Q. Will I get tax relief on my AP contributions?
A. We cannot advise you about your personal tax position but members of a registered pension scheme, like the NHS Pension Scheme, can normally contribute up to 100% of their salary and claim tax relief.....

When paying for AP by instalments tax relief is usually received through the PAYE system. If you pay by lump sum you will need to contact your local tax office or complete a self assessment tax return to claim the tax back."

Is this relevant to your situation?

hugheskevi

I am so frustrated and getting nowhere and am going to be so disappointed if I'm wrong

You are correct.

I have read on several ocassions that this is not the case and that as this is a Final Salary Scheme Relief will not be taken at source.

It isn't really relevant that it is a Final Salary scheme. What matters is that the pension operates neither Relief at Source nor Net Pay Arrangement, and hence all relief has to be reclaimed from HMRC.

I tried to give everything I knew about it to the woman, but she argued I was wrong and referred me to her manager, after waiting 10 minutes

I've facilitiated lump sum contributions to public sector Added Pension for two different people now. Both times HMRC have started off by telling me I am wrong and (quite arrogantly) saying I don't understand the rules :mad:

There was no easy solution in my experience - ensure HMRC have everything in writing (which it sounds like they do), then call and insist that a technical specialist looks at it if the phone operater keeps says you are wrong. Personally, I found it helpful to keep reiterating that this is not a Relief at Source scheme (which is what they are assuming when they talk about higher rate relief).

I need something in writing to prove to the next person I speak to

It probably won't help (although the link in the post above is good to use) - you need to speak to someone who knows what they are talking about otherwise you will repeatedly get told you are wrong regardless of what you say or ask them to look at. On one occasion a lady at HMRC told me she had asked all the people in her section, and they all agreed I was wrong Given their own pension scheme offers Added Pension under the same arrangements, their level of knowledge is concerning.

Personally I would just keep calling them back until you speak to someone who knows the correct rules or agrees to refer to technical specialist. Might take 3 or 4 calls though until you get someone helpful.

dibdabable

xylophone wrote: »

http://www.nhsbsa.nhs.uk/1289.aspx
"Q. Will I get tax relief on my AP contributions?
A. We cannot advise you about your personal tax position but members of a registered pension scheme, like the NHS Pension Scheme, can normally contribute up to 100% of their salary and claim tax relief.....

When paying for AP by instalments tax relief is usually received through the PAYE system. If you pay by lump sum you will need to contact your local tax office or complete a self assessment tax return to claim the tax back."

Is this relevant to your situation?

Yes sorry I should have said, I actually mentioned this was on the NHS Website, but the woman got around that one by saying, well it says they cannot advise you and that's because they don't know how these things work, she also said it should read that this is only for higher rate tax payers!! I really need something more specific but thank you anyway.

dibdabable

Thanks hugheskevi. I think you're probably right it looks like a lot of phoning. I was beginning to doubt myself in the face of the womans arrogance and patronising behaviour. You have mentioned some really good points and things to go on.:T We shall persevere and will make a note of the process as we're likely to add to his pension again next year!!!
Will let you know how we get on.

Goldenyears

I am wondering if part of the problem lies in the form of letter/receipt provided by NHS pensions, but I am surprised that (parts of?) HMRC are still not up to speed on buying additional pension by lump sum from savings, particularly as some of their own staff must be doing it in their own scheme.

I was one of the first civil servants to do this in 2008 after the end of added years. At first HMRC claimed the letter from my dept. provider confirming my payment was not a valid receipt. It took another letter from me to convince them, however as I said it was a new procedure then.

dibdabable

Thanks all. Well I am feeling a lot more confident about the whole thing I knew I was right but didn't have the info frEsh in my mind because one the HMRC had already said that OH would be due a refund and as it's 9 weeks since we sent it, we hadn't read up on it recently.
We'll attack this afresh with HMRC on Monday.

xylophone

Can your husband ask for a self assessment form? http://www.hmrc.gov.uk/worksheets/sa150.pdf
Would the payment go here?
Box 3 Payments to your employer’s scheme which were not deducted from your pay before tax
If you made payments to an employer’s registered pension scheme and no tax relief was given at the time of payment, you can claim relief for them now by entering in box 3 the total amount you paid in the tax year. We will work out the tax relief and give you credit in your tax calculation.

Is there nobody among your husband's colleagues who has purchased AP with a lump sum?
http://www.hmrc.gov.uk/pensionschemes/ If all else fails, ask the pension scheme administrator to contact these people?

Deneb

My wife made a lump sum AP payment into the NHS scheme in 2011, and has been making additional monthly payments this year. In both cases, the refund of tax has been dealt with through PAYE. In the case of the lump sum payment, it was dealt with by a PAYE refund in her subsequent salary payment, which together with the normal PAYE deduction not being applied to that month's salary, equalled the refund owing on the AP payment.

dibdabable

Thanks for both htese comments and both of them will certainly be worth following up. Certainly even if we can't follow up on the self assessment form for example it's something we can use as a form of proof that it's acceptable to receive the refund. I suppose at the end of the day Pension Contributions attract tax relief however they are paid and it seems obvious to me at least that my husband has not received any relief for his at any point so I suppose that would be a good negotiating tool.

As for the refund through PAYE I'll get him to follow this up at wages at work although they aren't known for their help!!! Also they'd probably want to see the paperwork which is currently sitting with HMRC, it makes me wonder whether HMRC would have even bothered responding seeing as it's been with them since April.
As said I'll update this as and when.Although frustrating we feel a lot happier knowing we were correct and this will help us move forward.Thanks to all thus far.

xylophone

My wife made a lump sum AP payment into the NHS scheme in 2011, and

has been making additional monthly payments this year. In both cases, the refund of tax has been dealt with through PAYE. In the case of the lump sum payment, it was dealt with by a PAYE refund in her subsequent salary payment, which together with the normal PAYE deduction not being applied to that month's salary, equalled the refund owing on the AP payment.

Interesting because this does not appear to have happened in the case of the OP's husband? The OP seems to be saying that the lump sum purchase was made around February this year? In the scenario you describe, he would have expected a refund in (say) March/April?

It seems unlikely (though not impossible) that he failed to notice (maybe if he had a lot of overtime or perhaps an adjustment to his tax code etc)?