Can I deduct contributions to my child's pension from my income for tax credits?

Legacy_user

I've read that you can deduct your own pension contributions from your income when applying for/renewing tax credits, but can I also deduct contributions I make to my son's pension from my income and therefore get more tax credit to compensate? (His pension will be a better investment than mine)

Also not sure if you can claim a NI rebate for it too

Icequeen99

MatthewAinsworth wrote: »

I've read that you can deduct your own pension contributions from your income when applying for/renewing tax credits, but can I also deduct contributions I make to my son's pension from my income and therefore get more tax credit to compensate? (His pension will be a better investment than mine)

Also not sure if you can claim a NI rebate for it too

Have you asked HMRC their thoughts?

Edited to add: The legislation just says you can deduct payments made to a registered pension scheme. So technically it would appear that it doesn't have to be your own pension scheme unless there is something in the definition of 'registered pension scheme' in the taxes act that prohibits it.

They could potentially argue that it should be treated as your income under the notional income rules - i have seen them try that once with regards to excessive pension contributions but it never got as far as appeal.



IQ

NYM

Would this link help ? Family Pension Plans...

It does mention that;

This clause ensures that employees will not enjoy exemption from
income tax and NICs on such contributions into the family member’s
pension scheme, to protect against attempts to sidestep the Annual
Allowance limit.

xylophone

http://www.entitledto.co.uk/help/tax-credit-pension-contributions

It seems to me that you are only allowed to use contributions to your own personal or occupational pension for TC purposes.

Any tax relief given on contributions to another person's pension goes to that person, not to the donor.

http://www.nidirect.gov.uk/tax-relief-on-pension-contributions

"Tax relief if you contributed to someone else's pension scheme

You can put money into someone else's personal pension - like your husband, wife, civil partner, child or grandchild's. They'll get tax relief added to it at the basic rate, but this won't affect your own tax bill. If they've got no income, you can pay in up to £2,880 a year - which becomes £3,600 with tax relief.

If the pension scheme rules allow it, you may also be able to put money into someone else's workplace pension. You won't get tax relief on your contribution, but the other person can get relief either through their tax return or by making a claim to HMRC by telephone or letter."

System

Thank you everyone, I think from what you've showed me it would be notional income, the relief wouldn't be mine and although it probably wouldn't be punished they are already wise to it and messing with the man won't work. I think HMRC could be more specific, and thankyou for all saving me godknowshowlong on the phone to them. Think I'll try to help him with property instead, pensions come at a less needed time in life

:beer: