SIPP Tax Relief Timing

hall2056

Hi, I opened a SIPP with HL in April 2017, following some research on investing.

As a 40% full time working tax payer, my question is when do I claim the tax relief over and above the 20% that HL claim and pay monthly into my account? Should I wait until the end of 17/18 tax year or claim periodically?
Not sure if this makes any difference but I also have a DB pension, which I contribute, as an employee, and for 17/18 will exceed the £40,000 threshold, but I have some unused allowances from the previous 3 years.
I am 55, and planning to take my DB pension at 60.

hall2056

BoGoF

You can either notify HMRC now of the SIPP payments and they will adjust your tax code or wait till end of the tax year. Going forward HMRC would include it in your tax code for following years.

hall2056

Thanks for the quick reply. I am only planning on paying into the SIPP for 17/18 tax year, due to the £40,000 annual threshold on pension allowance, I will be under the £40k for 17/18, based upon my previous 3 years, but from April 2018, I am planning on paying £20,000 a year into my S&S ISA.
Do you know how HMRC will forecast my tax code when the SIPP payments stop?
Hall2056

BoGoF

You will need to tell them that you are paying the SIPP for 17/18 tax year only

OldMusicGuy

They will base it on what you paid last year, so unless you tell them you are not doing it any more when you receive your tax code then you will underpay tax and have to pay it back at the end of the year. You will be able to see how much they have assumed you will pay when you get the notification of your tax code.