Worth me adding lump sums to my works pension?

Dazed_and_confused

AandP wrote: »

All these details were from a P800 refund letter (2017-2018) from HMRC giving a refund of £28 over payment. Previously HMRC asked for and received confirmation from Black rock that they would not and could not add tax relief at source on my pension account payment. This was confirmed recieved by HMRC.

It looks as though HMRC have treated your payment as a relief at source payment. Where a payment is made in this way any additional tax relief due is given by the grossed up payment increasing the amount of basic rate tax you can pay which in turn reduces any higher rate tax due. In your situation the basic rate band being increased is of no benefit as you aren't paying higher rate tax (and is wrong as this isn't the type of pension payment you have made per previous posts)..

You will need to ask HMRC to correct your P800 to remove this pension relief entry and replace it with the correct one and then the P800 should show the tax overpaid (should be £2800 if the original calculation was correct in all other respects).

OldBeanz

I made a lump sum payment into the Civil Service Pension Scheme (which they would have been members of) and HMRC did not understand that concept without a flurry of letters and phone calls. Found out the hard way that they only refund up to the tax you have actually paid - but only by £100 or so. You may need to rattle their cage a few more times but you will get there eventually.

AandP

Thanks for all your help and advice, had I known before how much trouble things would be before I started I don't think I would have bothered and all for minimal gains if any at all. As it stands now I have paid tax on my savings which are now in my pension and will have to pay tax yet again to take it back out. I have contacted TPAS for reassurance and will try once again to phone HMRC. You would have thought that they would be the one place who you could trust to know what they are doing.....

xylophone

Is your occupational pension relief given on the "net pay" basis?

That is to say, your pension contribution is deducted before tax?

This being the case, the pension provider cannot give "relief at source?"

Like Roger in this example, you wanted to make a lump sum contribution far larger than your monthly salary?

https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm044240

AandP

Please see https://forums.moneysavingexpert.com/discussion/5864919/hmrc-say-no-tax-relief-on-pension-contribution-as-im-a-20-tax-payer&page=2

for updates etc.