Contributions exceed annual taxable income

Jeff007

Facts: In December i mistakenly made a single lump sum payment into my persional pension plan with prudential of an amount that it looks like will exceed my annual taxable income this year. I over estimated my likely income.
The contribution is sitting as a 'cash reserve' still because I didn't allocate it to Fund.
Prudential will have added basic rate relief at source to my fund. I am a 40 % income tax payer.
I called Pru to ask if they would repay me part but they wouldn't. But that was just the helpline.

Question: Is there any way I can get them to pay me all or part of my contribution back as a genuine mistake/miscalculation? Any advice or experience is welcome. Thanks.

Aegis

You may wish to call them again and refer them to the following pages from the Registered Pension Schemes Manual:

http://www.hmrc.gov.uk/manuals/rpsmmanual/RPSM05101510.htm

Specifically the bit stating:
"Where a member has paid relievable pension contributions in a tax year of more than the maximum amount that can receive tax relief (see RPSM05101120) the amount of contributions that cannot receive tax relief may be repaid to the member. This is called a refund of excess contributions lump sum. Further information can be found at RPSM05101540 to RPSM05101550."

http://www.hmrc.gov.uk/manuals/rpsmmanual/RPSM05101540.htm

"The legislation refers to this as the ‘excess contributions condition’. If this condition is met, the excess contributions can be paid to the member as a refund of excess contributions lump sum.

The payment must be made before the end of the period of six years beginning with the last day of the tax year in which the ‘excess contributions condition’ was met, i.e. the tax year in which the ‘excess’ contribution was paid."


As such, they are able to pay back excess contributions, and if they are unwilling to do so you should issue a formal complaint to request that they pay the amount of your annual allowance charge, as it is entirely within their means to help you not pay that at all by simply refunding the contribution.