Pension Contributions and Tax Relief

MiniMerc2012

Morning All, im hoping for some help on the below. Apologies in advance for what may be a silly question!

I am a member of my workplace DC pension scheme, to which i pay in 6% of my salary before tax (which is currently £47370/yr). My employer then matches this contribution. Looking at my pension statement online, this means that there is a contribution of £237 from myself and £237 from my employer.

Here are my questions:
1) When i enter the above numbers into this calculator (
http://www.moneysavingexpert.com/tax-calculator/) it is states that an additional £95/month cam be claimed from HMRC by the employer in the form of tax relief on the contribution. To date, i do not seem to have received this on any of my monthly contributions for the 20 months i have worked for this company. Id need to check my statement from my previous employer (which had a similar scheme) to understand what happened there. How do i claim this back?

2) looking at this calculator (http://www.hl.co.uk/pensions/interactive-calculators/tax-relief-calculator) and entering the same numbers above, it seems that, as a higher rate tax payer, i can also claim back another £568 through a tax return. I have never done this ad i have never had to fill in a tax return before. Again'-how do i claim this back?

Appreciate any help you can give!

PeacefulWaters

I would be almost certain that you have nothing to claim back.

Employment pension contribution is usually deducted from gross pay. Your payroll department won't have deducted income tax for your pension so your net pay will reflect the tax relief.

Mistermeaner

MiniMerc2012 wrote: »

Morning All, im hoping for some help on the below. Apologies in advance for what may be a silly question!

I am a member of my workplace DC pension scheme, to which i pay in 6% of my salary before tax (which is currently £47370/yr). My employer then matches this contribution. Looking at my pension statement online, this means that there is a contribution of £237 from myself and £237 from my employer.

Here are my questions:
1) When i enter the above numbers into this calculator (
http://www.moneysavingexpert.com/tax-calculator/) it is states that an additional £95/month cam be claimed from HMRC by the employer in the form of tax relief on the contribution. To date, i do not seem to have received this on any of my monthly contributions for the 20 months i have worked for this company. Id need to check my statement from my previous employer (which had a similar scheme) to understand what happened there. How do i claim this back?

2) looking at this calculator (http://www.hl.co.uk/pensions/interactive-calculators/tax-relief-calculator) and entering the same numbers above, it seems that, as a higher rate tax payer, i can also claim back another £568 through a tax return. I have never done this ad i have never had to fill in a tax return before. Again'-how do i claim this back?

Appreciate any help you can give!

Not used a calculator buy those amounts look like 6% of your salary from which no tax has been deducted so look correct. When you are paye your pension deductions are taken prior to tax being removed hence there is no tax relief to claim back.

MiniMerc2012

Ok thabks for the quick responses. So if i have understood it correctly, the tax allowances etc are all handled by my employer since everything is taken from net salary?

molerat

No, the pension is taken from your gross salary so automatically accounts for any higher rate tax. Your P60 will show taxable pay as £44526 (47370 - 2844).

PeacefulWaters

Have you considered increasing your contributions further to avoid paying 40% tax altogether?

MiniMerc2012

PeacefulWaters wrote: »

Have you considered increasing your contributions further to avoid paying 40% tax altogether?

I am currently reevaluating my contributions-i have been going through a big house renovation so have needed lots of disposable cash up to now. If i knew that my salary was going to remain the same then that is exacrly what i would do, howevere I am shortly going to see a further salary increase to around 55k due to an internal promotion and am going to reassess after this.

I also buy £124 of childcare vouchers per month and can have my pension contribution matched up to 9%. My key requirement will be keeping beneath 50k net to avoid having to pay back child benefit.

ColdIron

Rule of thumb, put 50% of you pay increase into your pension, all things being equal

jamesd

Compare what is deducted from your pay with what is paid into the pension. If the numbers are the same after allowing for employer matching you have no more tax relief to claim.