Paid £9500 avc but only £1529 tax relief?

jem16

philng wrote: »

It is buying me an extra cash pot not extra years. I have been told I can draw the AVC cash pot on retirement as a lump sum rather than taking a lump sum from the main scheme up to certain limits.

So who is the pension provider for the AVC?

Are you absolutely sure the pension provider did not add 20% basic rate tax relief onto your payment?

philng

Progress update:

Spoke to first person at HMRC who didnt seem to understand what I was saying. I asked to speak to a Manager as frustrated by now.
Spoke to Manager who understood what I was saying & confirmed they had only applied the top up 20% relief. Said he needed to see the paperwork I sent 3 months ago & this would take 2-3 weeks!
I said have copies here & can fax them now which he accepted-He rang back to confirm receipt & apologised for their error.
The paperwork clearly states NO TAX relief has been applied.
Suppose I will have to wait a few weeks to get the extra payment but reckon it is £1900.
Had I not been alert that is simply a payment I would never have received.

jem16

philng wrote: »

The total income is worked as follows:

48952 PAYE
2964 Car Benefit
117 Gross Interest received

52033 Total

p60 Tax Paid 10429

Based on above figures;

Total £52033

Minus £9500 = £42533

Minus £7475 = £35,058 taxable.

£35,000 at 20% = £7000
£58 at 40% = £23.20
Total tax = £7023.20

Tax already paid is £10,429.20 + £23.40 ( based on £117 gross interest taxed at 20%) = £10,452.60

Refund is £10,452.60 - £7023.20 = £3429.40

philng wrote: »

Progress update:

Spoke to first person at HMRC who didnt seem to understand what I was saying. I asked to speak to a Manager as frustrated by now.
Spoke to Manager who understood what I was saying & confirmed they had only applied the top up 20% relief. Said he needed to see the paperwork I sent 3 months ago & this would take 2-3 weeks!
I said have copies here & can fax them now which he accepted-He rang back to confirm receipt & apologised for their error.
The paperwork clearly states NO TAX relief has been applied.

Glad to see someone finally has their head screwed on the correct way.

Suppose I will have to wait a few weeks to get the extra payment but reckon it is £1900.

Near enough. Did you ask for a refund for the total amount as opposed to a change in tax code?

Had I not been alert that is simply a payment I would never have received.

Unfortunately it always pays to be vigilant.

philng

They have already sent me a cheque for £1529 & he said the rest will also follow by cheque.

jamesd

Good to read that you ended up with the positive result I've usually had when phoning HMRC, though not so good that you had to ask for a manager to get there!

Hopefully any other employees may learn from your experience and get any relief they haven't been getting.