Pensions tax relief given job income at 40% threshold and savings topple

Dazed_and_confused

You get income tax repayments via one of two methods, a cheque or you get a calculation inviting you to go into your personal tax account and enter your bank details so the money can be paid into your bank account.

The point I was making was that until you get HMRC to understand what you are trying to do for last year and take all the relevant details to accurately calculate your tax you won't get any rebate at all because they won't have the details to be able to calculate any refund which may be due.

TrustyOven

Just an update: I called HMRC again a little while ago.

My SIPP contribs are small so they adjusted my tax code on the spot.

Regarding my workplace pension, they will adjust my tax code. I will get my first ever Self Assessment form in the next 10 or so days. I'll need to do a bunch of reading on how to properly fill it in.

The consequence is that none of the higher rate relief will go into the pension wrappers. I'm not sure if that's good or bad but that's how it will be.

Dazed_and_confused

Are you now saying you have two different pension contributions?

Don't think you've mentioned this before?

What adjustment is required for your "workplace" pension?

What reason was given for you needing to complete a tax return as you haven't posted anything previously which suggested this was necessary.

No one can have the extra higher rate tax relief paid into the pension fund by HMRC.

greenglide

I will get my first ever Self Assessment form in the next 10 or so days. I'll need to do a bunch of reading on how to properly fill it in.

The online version is much easier than the hard copy version. If they are expecting one from you then you should be able to access it via the personal tax account?

TrustyOven

greenglide wrote: »

The online version is much easier than the hard copy version. If they are expecting one from you then you should be able to access it via the personal tax account?

They just said they are posting one out to me.
I am not usually in the pool of people that would usually do a self assessment, so I suspect this would be a one-off.

Not sure why it won't be done online.

TrustyOven

Dazed_and_confused wrote: »

Are you now saying you have two different pension contributions?

Don't think you've mentioned this before?

Apologies if I've not mentioned this. Yes, I have a workplace DC pension and also a SIPP.
Workplace: paid net from PAYE, I can see Aviva adding basic rate tax relief to it.
SIPP: paid net from my bank account, and I can see HL have started adding basic rate tax relief.

Dazed_and_confused wrote: »

What adjustment is required for your "workplace" pension?

I don't know yet.
One would imagine they'd need to give me more tax relief

Dazed_and_confused wrote: »

What reason was given for you needing to complete a tax return as you haven't posted anything previously which suggested this was necessary.

So that they can calculate how much to give back to me as higher rate tax relief....

Sorry.. I thought this was obvious. And your questions now make me doubt things. Are you suggesting I was wrong and that I shouldn't have done any of this? Am I doing things incorrectly?

Dazed_and_confused wrote: »

No one can have the extra higher rate tax relief paid into the pension fund by HMRC.

I'm confused.... Why not?

Linton

No one can have the extra higher rate tax relief paid into the pension fund by HMRC

TrustyOven wrote: »

I'm confused.... Why not?

Because the system is automatic but can only deal with the most common case, which is basic rate tax relief. Every one gets it fairly quickly and those who get it wrongly can be sorted out at the end of the tax year.

In any case HMRC dont know that you should be paying higher rate tax until the end of the tax year. They neednt know anything about your pension arrangements or your income when the basic rate tax is refunded.

TrustyOven

Linton wrote: »

In any case HMRC dont know that you should be paying higher rate tax until the end of the tax year. They neednt know anything about your pension arrangements or your income when the basic rate tax is refunded.

They know about it now though.
This is for tax year 2016 - 2017, and I already have my P60 so they should know already.

jamesd

For 2016-17 you'll be able to do it online even though they sent you a paper one and I suggest that you do, it's easier for you and gives you more time to get it done.

Higher rate tax relief does go into the pension for those using salary sacrifice or net pay work schemes. It's the workplace relief at source schemes and personal pensions where it doesn't.

They may not yet know about P11D form benefit in kind payments or some types of interest. In any case there's some advantage in filing a return, pain though it is, because they normally have only one year from you filing to question anything that you've told them.

Linton

TrustyOven wrote: »

They know about it now though.
This is for tax year 2016 - 2017, and I already have my P60 so they should know already.

They would then increase your tax code so that the PAYE calculations worked out correctly (or roughly correctly).