Taxable pension contributions to a workplace pension?

markovts

Hi all,

I was wondering if any of you could help me here.

My employer pays 8.8% of my monthly salary into a pension for me. I opted to contribute another 6% on top of that, which comes off of my monthly salary, pre-tax. I also pay around £34 a month for private healthcare through the work....again, this comes off pre-tax.

I have noticed however that on my payslip, the gross pay and taxable pay are the same - should the taxable pay not be my gross pay minus my 6% pension contributions (and maybe my private healthcare payment too - although this isn't my main query).

A few people that work here have payslips showing the taxable pay is less than the gross pay (the 6% has been taken off) - but there are a few people here who are in the same boat as me and this 6% hasn't been taken off the taxable pay.

Someone has suggested we may need to claim this back in a self-assessment form, but I'm looking for some advice before I speak to HR incase they try to fob me off or give me the slopey shoulder.

Thanks in advance

Mark

Linton

Most companies take pension contributions from gross pay but they can take them from taxed pay leaving you to claim the tax relief if a higher rate taxpayer. In your case it does seem strange if different employees are being treated differently.

Is the pension deduction shown on your payslip, and shown as coming off the net pay? If not it may not have been taken at all.

One possibility is that your company operates a salary sacrifice scheme whereby the company pays "your" pension contributions but reduces gross salary accordingly. Again though you would not expect different employees to be treated differently.

So yes, you should ask HR or perhaps the payroll department.

jem16

markovts wrote: »

I have noticed however that on my payslip, the gross pay and taxable pay are the same - should the taxable pay not be my gross pay minus my 6% pension contributions (and maybe my private healthcare payment too - although this isn't my main query).

If your pension contributions are paid before tax then yes I would expect your gross pay and taxable pay to be different.

Can you check your tax? Are you being taxed on the full gross amount or the post contribution amount?

Does your pension provider add on basic rate tax relief or not?

Someone has suggested we may need to claim this back in a self-assessment form, but I'm looking for some advice before I speak to HR incase they try to fob me off or give me the slopey shoulder.

Thanks in advance

Mark

Only higher rate tax relief would need to be claimed back. Basic rate tax relief is either added by the pension provider or by paying less tax in the first place.

markovts

OK a little update to this.

Apparently the reason for this is that my extra contributions are being classed as a "personal" pension, rather than towards a workplace pension.

We have been told that we have to fill out a self assessment tax form after getting a "statement of earnings" from our payroll dept.

Is this correct?

Thanks

Mark

jem16

markovts wrote: »

OK a little update to this.

Apparently the reason for this is that my extra contributions are being classed as a "personal" pension, rather than towards a workplace pension.

Ok fair enough. A Group personal pension usually takes contributions from net pay.

I asked earlier but you haven't replied - is your pension provider adding on the basic rate tax relief as would be expected on a personal pension?

We have been told that we have to fill out a self assessment tax form after getting a "statement of earnings" from our payroll dept.

Is this correct?

Thanks

Mark

Are you a higher rate taxpayer? That would be the only reason for claiming extra tax relief.

A self assessment isn't needed just to claim higher rate tax relief. You can simply phone up HMRC and they will adjust your tax code.

If you're a basic rate taxpayer you shouldn't need to claim anything.

markovts

Sorry Jem,

No, I don't appear to get any "tax relief" - I know there is nothing showing on my payslip anyway that's for sure.

*EDITED* no sorry I am actually not in the higher rate of tax payer......2 different sites gave conflicting income brackets for higher rates of tax. I am under the 41K threshold for 40% tax.

All I need to know now is -

1 - is the Taxable pay correct given the above information
2 - if not, how do I claim the "overpayments" of tax back?

Thanks again

Mark

jem16

markovts wrote: »

Sorry Jem,

No, I don't appear to get any "tax relief" - I know there is nothing showing on my payslip anyway that's for sure.

Have you checked your pension statement? Nothing will show on your payslip as basic rate tax relief is added to your pension by your pension provider.

Yes I'm a higher rate taxpayer - I fall into the 40% category.

All I need to know now is -

1 - is the Taxable pay correct given the above information

If it's paid from net pay then yes.

2 - if not, how do I claim the "overpayments" of tax back?

Thanks again

Mark

You will only be able to claim the extra 20% back and you can go back 4 tax years.

Phone up HMRC to claim.

markovts

Sorry I just editted my last post - I'm not a higher rate tax payer. 2 different sites gave conflicting information about salary brackets for tax rates. I'm just below 41k.

jem16

markovts wrote: »

Sorry I just editted my last post - I'm not a higher rate tax payer. 2 different sites gave conflicting information about salary brackets for tax rates. I'm just below 41k.

Then there should be no need to claim anything.

Check your pension statement to see if basic rate tax relief has been added but that's what normally happens.

markovts

Thanks, I'll be sure to check my pension statement when I get it through.

What if this isn't on there?

Mark