Claiming higher rate tax relief on a work pension

sh856531

Hi all

I read recently that people who pay tax at 40% automatically get tax relief up to 20% on their pension contributions, but in order to get the extra 20% they need to fill in a self assessment tax form?

Can anyone tell me if this only applies to SIPPs? I do have a SIPP but I'd be much more concerned about my work stakeholder pension as 20% on the contributions I make there would add up to a moderate amount of cash.

Thanks

Simon

jem16

sh856531 wrote: »

Can anyone tell me if this only applies to SIPPs? I do have a SIPP but I'd be much more concerned about my work stakeholder pension as 20% on the contributions I make there would add up to a moderate amount of cash.

Thanks

Simon

It definitely applies to all private pensions be it stakeholder, PP or SIPP as these are always paid from net pay after tax has been deducted.

How do you pay into your works pension? Is it from gross or net pay?

If it's from gross pay before any tax is deducted then you have full tax relief already and no need to claim.

Linton

Its not the type of pension (SIPP, SP, PPP, GPP etc) that matters but rather when in the process the pension payment is deducted.

Most people paying into an employers pension will have their contributions paid from gross income before working out the tax and therefore dont get any tax relief as they never pay tax in the first place. Some employers may take the money from your net income after tax in which case you will need to claim the extra Higher Rate relief in your tax assessment.

You can possibly tell what is happening from your payslip, if not check with the payroll people.

xylophone

Usually, a stakeholder pension is a "Relief at Source" arrangement

https://www.gov.uk/tax-on-your-private-pension/pension-tax-relief

But a poster pointed out a few weeks back https://forums.moneysavingexpert.com/discussion/comment/67649812#Comment_67649812

However some companies offer stakeholder pensions where contributions are taken from gross pay.

Basically if your taxable pay is less than your gross pay by the amount of the pension contribution, then all tax relief has been given and there is no need to do anything further.

What are the details on your pay slip?