Salary Sacrifice and Tax Relief

shemyaza

Hello,

I am a higher rate taxpayer but I haven't yet claimed the extra tax relief on my pension contributions. Am I correct in thinking that I can only do this for the period when my contributions were taken from my 'pay' and not for the subsequent period when the pension contributions have been 'salary sacrifice'? I am under the impression that the salary sacrifice means I have already received the relief is that correct?

Thanks

Shemyaza

jem16

If your pension contributions were made after tax had been deducted from your salary, then you can claim the extra 18% relief vai your tax return.

If the contributions were made before tax was deducted then you already have the full tax relief. Salary sacrifice would fall into this category.

cloud_dog

Just to reiterate what Jem said, normally for a company pension your pension contributions are deducted before tax is calculated / deducted therefore there is no additional relief to claim.

If you make additional contributions outside of PAYE then you will need to claim this additional relief. Probably isn't applicable based on the info you provided.

Wrt Salary Sacrifice you will probably find you are no worse / better off from a pension position regarding costs / taxation, however you will gain from lower NI contributions as this is based on the lower salary figure.

cloud_dog