CS Pension Classic - PIP and Annual Allowance!!?

bitofatit

Oh Dear God why is this so difficult ....some help pls?

My partner is a Civil servant and is finishing in September.(39 + years of service). I'm encouraging her to put money into a SIPP to get back some of the Higher rate & possibly std rate tax in her last year.

I'm struggling understanding is it too late to pay into a SIPP for her to gain the tax back? She will have no earnings past September 2015 - has she missed the boat?

What I have discovered is the CS Pension Input Period runs on a calendar year basis; I had thought is would mimic the normal tax year.

So I think any additional contribution in March 15 would fall into the PIP for 2015 and thereby part of the 2015/16 tax year?

For the 1sr time ever I shamed her into paying a good chunk into a SIPP last March which I'm guessing fed into 2014/15 tax year?

So my question is assuming she had sufficinet earnings is it sensible to pay money into a Sip now / new tax year?

And if so how does this play out with the tax office. I guess she would get 20% tax break on input to SIPP and the other 20% might not be available as she is on her pension from October?

I'm confussed.com

kidmugsy

I'll tell you what I understand, and will happily accept correction by experts.

The tax year that counts for a contribution is the tax year in which it's made.

The PIP matters for technical stuff, such as the annual allowance.

bitofatit

kidmugsy wrote: »

I'll tell you what I understand, and will happily accept correction by experts.

The tax year that counts for a contribution is the tax year in which it's made.

The PIP matters for technical stuff, such as the annual allowance.

So I think I'm conflating to issues.
If there is head room re calculating the annual allowance. Bung in some money into a SIPP in this Tax year?

kidmugsy

bitofatit wrote: »

So I think I'm conflating to issues.
If there is head room re calculating the annual allowance. Bung in some money into a SIPP in this Tax year?

This month: she'd be using the 2014-15 tax relief. The civil service PIP doesn't determine the SIPP PIP. (But beware: I'm no expert.) Why not phone the good people at Hargreaves Lansdown, or AJ Bell, or whomever, and ask them? Especially AJ Bell, who will let you adopt a PIP that doesn't correspond to the tax year if you wish.

hyubh

bitofatit wrote: »

What I have discovered is the CS Pension Input Period runs on a calendar year basis; I had thought is would mimic the normal tax year.

Usual thing for public sector schemes is to run 1 April to 31 March, although that practically comes down to the same thing (for the annual allowance the PIP end date determines the relevant tax year).

So I think any additional contribution in March 15 would fall into the PIP for 2015 and thereby part of the 2015/16 tax year?

Yes (assuming we're talking about the annual allowance). Any other pension contributions would be assessed according to the end date of their own PIP.

Steve489

Have you considered buying Civil Service Added Pension (AP) by lump sum or monthly contributions rather than investing in an external SIPP? I found AP good value with a good chance of breaking even by my late 70s as a higher rate tax payer when working - but my pension age was 60.

bitofatit

Steve489 wrote: »

Have you considered buying Civil Service Added Pension (AP) by lump sum or monthly contributions rather than investing in an external SIPP? I found AP good value with a good chance of breaking even by my late 70s as a higher rate tax payer when working - but my pension age was 60.

Yes they are fair value. She is doing just that but thiswould be a one off extra in one final push!