Inland Revenue and pension payments

sortofwinning

Hi, when I first opened my private pension, the man in HL told me that if I paid in above and beyond my earnings for the year, I would get a letter from Inland Revenue about it.


My current position is that I got bullied out of my last job and experienced a lot of mental health problems because of the bullying. I'm now ready to go back to work and I start a part time job on Monday. I am in the fortunate position of not having to pay very many bills because I live with my mum and she is aware I've been on a low income most of my life, and she wants me to save as much as possible for my private pension, as currently there's not a huge amount in it and I'm 43. Obviously I know that I can pay in up to 100% of what I earn from Monday onwards, so that will be easy to keep track of.


But I have a decent amount of money sitting in my current account and would like to get as much as possible of that money into my private pension. If I wrote to HMRC, would they be able to say that between 5th April 2016 and 18 Nov 16 (my last day of work), I paid in X amount to my private pension and can still pay in Y amount for the work I did during that period?


I can do a rough calculation using my P45, if someone can tell me would it definitely only have the amount I was paid from 5th april 2016 to 18 nov 16? I got it from my employer after I resigned. I can deduct the tax from the gross, factor in what has roughly been paid into my workplace pension during that period, leaving a bit of room for error, and then I always keep a record of how much I paid into my private pension so I can just see how much was already paid in after 5 april 2016.


Thanks for any help. I'm not very knowledgeable about pensions and don't want any stress from HMRC as I've had enough problems recently to deal with.

ex-pat_scot

You can contribute up to 100% of your salary for the tax year 2016-17, up to a total of £40,000. (if you earn more, and want to contribute more, then there are carry forward rules from 3 prior years. I suspect this won't be an issue based on your preamble).


It's 100% of your TOTAL earnings for the tax year. Not just in respect of your new job.


You will need to get the full details of the P45 from prior employment, in order to calculate how much you might have already contributed to their pension (if any) and what your gross salary was.
Your best bet would be to run through rough numbers here - if privacy is a concern, then by all means massage the actuals - you will see the principles and get a sense of it.
If you are struggling, then HMRC are actually helpful at this kind of stuff. It's a good idea to let them know anyway, so that they can credit you with the tax rebate from any net payment you might make into your pension. (the pension provider should auto apply to HMRC for Basic Rate tax relief). HMRC don't usually bite when asked these kinds of questions, but I'd avoid ringing them between now and end of Jan when the annual Self Assessment forms are due.

sortofwinning

Thanks very much ex-pat scot.


So I know it's 100% of the total, but what I was trying to say was that prior to resigning from my last job, I had money in my account that did not all come from earnings (some of it came from my mum), plus due to the illness, I missed printing off my last two payslips. So Monday onwards is ok, as I'll keep exact records of pay and workplace pension payments, but it's the period between 5-4-16 and 18-11-16 that is causing me the problems in trying to calculate 100% of the total.


So my p45 says up to 18-11, total pay to date was approx. 8,500. And total tax to date was approx. 230, leaving approx. 8,270 as net earnings between 5-4-16 and 18-11-16.


Because I don't have my last two payslips, I have to guess at the approx. amount paid into my workplace pension between 5-4 and 18-11. Previous payslips indicate I'm only paying £12 a month into my workplace one. So say April - Nov = 8 workplace pension payments = £96 but to leave plenty of room for error, I'll say £350 [I really don't want to get a letter from HMRC]. So 8270 - 350 = it's possible for me to pay in 7,920 to my private pension for the period of work between 5-4-16 and 18-11-16.


Cheque stubs show that after 5-4-16, I've only paid £3,500 into my private pension. So this means I can still pay in 7920 - 3500 = 4420 for the period of work between 5-4-16 and 18-22-16.


Does that all sound ok?