Warning for those completing Self Assessment with drawdown from a SIPP

andromedean

Is anyone else in this situation? Amazingly the broker who holds the SIPP (in my case Hargreaves Lansdown) is treated as an paying employer which is automatically added to my self assessment tax return. At first I thought is was an error, but HMRC confirmed this is what happens and the appreciate the confusion.

If you fill out the pension section with details of the drawdown income it will double up! I mentioned this to HMRC but they didn't seem to realise it would do this. So I added a note why the pension section wasn't filled out. The final calculation is correct though.

Hopefully this will avoid someone else going through the same baffling exercise

PS Here's a free site (with annoying pop ups) which can convert spreadsheets and other document types to pdf. This is the only type of attachment HMRC accept!

http://www.convertfiles.com/convert/document/ODS-to-PDF.html#

taylornj

Haven't got to my self assessment yet. Have a SIPP in drawdown will see what happens. Does tend to be quite complex my self assessment.

For PDF files, I can use libreoffice that allows exporting as pdf files.

Many programs allow documents to be printed as pdf to a file rather than to a printer.

Using a webservice that uses unencrypted http to convert documents is not a good idea, unless happy with the idea of your documents being publicly available.

andromedean

Actually having checked, so does my Openoffice, but didn't see the pdf icon.

I received something like a payslip from HL earlier this year so perhaps you got the same.

taylornj

andromedean wrote: »

Actually having checked, so does my Openoffice, but didn't see the pdf icon.

I received something like a payslip from HL earlier this year so perhaps you got the same.

I am not with HL. What I got was a P60 end of year certificate, everyone doing PAYE payments has to send one required by HMRC. The P60 was part of a three sheet form, one copy for records, one copy for the employee, and one copy for HMRC.

Cook_County

andromedean wrote: »

Is anyone else in this situation? Amazingly the broker who holds the SIPP (in my case Hargreaves Lansdown) is treated as an paying employer which is automatically added to my self assessment tax return. At first I thought is was an error, but HMRC confirmed this is what happens and the appreciate the confusion.

If you fill out the pension section with details of the drawdown income it will double up! I mentioned this to HMRC but they didn't seem to realise it would do this. So I added a note why the pension section wasn't filled out. The final calculation is correct though.

Hopefully this will avoid someone else going through the same baffling exercise

PS Here's a free site (with annoying pop ups) which can convert spreadsheets and other document types to pdf. This is the only type of attachment HMRC accept!

http://www.convertfiles.com/convert/document/ODS-to-PDF.html#

Nothing to stop you completing your self-assessment tax return wrong, but pension income is reported as pension income.

andromedean

Evidently not, that's the point of my post.

HMRC pre-entered it in as employment income and it's automatic, it can't be removed. They insisted that is how drawdown is defined. So if I fill in the Pension section it doubles my income (I've tried it). I warned them that would probably happen, and I'm certainly not paying double tax!

However, I have explained the omission in the notes, so the ball is definitely in their court and I've done everything possible to conform.

Dazed_and_confused

I guess you're talking about an "employment" page that HMRC had pre-entered?

Even if you couldn't remive this surely you could have amended the figures to 0 - it is meant to be "Self" Assessment after all

andromedean

I tried this and it threw up an error code. HMRC verbally confirmed the figure should be entered there for drawdown anyway.

andromedean

I've spoke with HMRC again at length, and they appear very unconcerned. However, I think they have made a !!!! up and don't want to admit it.

"It won't make any difference. If you like we can change it from the employment to the pension section. Our back office normally correct these things automatically,"

Hargreaves Lansdown say

In our submission to HMRC we ensure that it is clear that the income you receive from us should be classified as taxable pension income and not income from employment. You may need to verify this with HMRC as it is my understanding that we should not be classified as your employer in your self-assessment.

I doubt if anyone else has this problem to be honest.

Cook_County

Where/how do HMRC pre-enter self-assessment tax returns? MTD is not starting until 2017?

Apodemus

Cook_County wrote: »

Where/how do HMRC pre-enter self-assessment tax returns? MTD is not starting until 2017?

My thoughts too! Is this something new in this year's self-assessment? I've not started mine yet, but never had anything pre-entered before!