Annual Allowance

jem16

OldBeanz wrote: »

Bottom line is can I pay another £17k into my CS pension this year while still atracting tax relief?

I doubt you would have much problem with that. However to be sure why don't you ask your pension provider for the AA figure or use the calculations hyubh has provided?

OldBeanz

Thanks for the help. Next opportunity is in January so will discuss it with them then although have rather forgotten what a pay rise is so am assuming this will should be ok to achieve my goals.

hyubh

OldBeanz wrote: »

One poster says allow for my employer's contributions another says not. :eek:

Assuming your employer only contributes to your main, DB pension, then its contributions have nothing to do with your pensions tax situation. Not saying everything about taxation makes sense, but in this case it does - to give another LGPS example (sorry!), if a person employed by a local authority is TUPE transferred to a small private sector employer that is risky from the pension fund's point of view, the fact the new employer will be subject to a very high employer contribution rate won't have any bearing on its new employees' tax situation.

That said, there are three things here: (a) the maximum you can contribute to DC (i.e., non-DB) pensions while gaining tax relief in the process (b) the pensions 'annual allowance' (c) the income tax 'personal allowance'. Your actual salary pertains to (a), my LGPS numbers pertain to (b), and the '£9.4k' you quoted pertains to (c).

woolly_wombat

OldBeanz wrote: »

I naively assumed that all his calcs re LGPS were in some way related to my issue.

Hyubh's calculations are most definitely related to your civil service pension, which is a defined benefit scheme.

You need to work out how much your civil service pension contributions are deemed to be worth by HMRC by following hyubh's method i.e. "subtract your accrued main CS pension as at the end of the year from the accrued amount 12 months earlier, and times the result by 16". Let's call this amount 'A'.

All the other contributions are dealt with differently:

The FSAVC amount is £30 x 12, i.e. £360.

The SIPP/stakeholder contributions including tax relief amount to £13,948.

Therefore, as I understand it:

Amount you can still contribute = £35,000 - A - £360 - £13,948.

WW

jem16

woolly_wombat wrote: »

The SIPP/stakeholder contributions including tax relief amount to £13,948.

The £13k included the amount paid into the Civil Service pension.

From my calculations the SIPP/Stakeholder was a gross payment of £4740 and tax relief on that is £948 which is what the OP said.

Therefore, as I understand it:

Amount you can still contribute = £35,000 - A - £360 - £13,948.

WW

That would be £35,000 - A - £360 - £4740.

OldBeanz

So I need to include the difference in value of my CS pension for the year after I have paid in and the govt have added their amount then multiply this amount by 16. This will give me A.
They should be able to tell me those figures now.

hyubh

OldBeanz wrote: »

So I need to include the difference in value of my CS pension for the year after I have paid in and the govt have added their amount then multiply this amount by 16.

Forget about contributions ('paid in', 'added their amount') when it comes to your DB pension, because they aren't relevant. You want the value of the pension (i.e., the amount of pension payable every year come retirement) were you to have left the job at that particular point. This will be quoted on your annual benefit statement - how complicated the calculation gets will depend on what historical protections apply. For a person in the LGPS both before and after the scheme last changed in April 2008, for example, their pre-April 2008 membership produces a pension calculated on a slightly different basis to their post-April 2008 membership.

OldBeanz

So ask them the annual payment due as of 4/4/13 and the envisaged value at 4/4/14; subtract the two; then multiply by 16.

woolly_wombat

OldBeanz wrote: »

So ask them the annual payment due as of 4/4/13 and the envisaged value at 4/4/14; subtract the two; then multiply by 16.

Subtract the amount of pension payable every year as of 31/3/13 from the amount of pension payable every year as of 31/3/14, and multiply the answer by 16. (The civil service pension 'year' runs from 1 April).

WW

Aegis

woolly_wombat wrote: »

Subtract the amount of pension payable every year as of 31/3/13 from the amount of pension payable every year as of 31/3/14, and multiply the answer by 16. (The civil service pension 'year' runs from 1 April).

WW

Don't forget to allow for inflation as well.