SIPP Contributions - Tax Year End

HHarry

In Short

If a contribution is made into a SIPP, is the 25% from HMRC credited on tne date received (which may be 10 weeks later) or the date of the original contribution.

In Long

I'm self-employed and want to pay into my SIPP 100% of my earnings - but I won't know what they'll be until April.
So if I make a contribution in April, there's a chance the 25% won't credit until the next tax year.

Thanks, HH.

Tom99

HHarry wrote: »

In Short
If a contribution is made into a SIPP, is the 25% from HMRC credited on tne date received (which may be 10 weeks later) or the date of the original contribution.
In Long
I'm self-employed and want to pay into my SIPP 100% of my earnings - but I won't know what they'll be until April.
So if I make a contribution in April, there's a chance the 25% won't credit until the next tax year.
Thanks, HH.

If it's 2018/19 earnings you are talking about you need to make the net SIPP contribution to the SIPP provider before 6th April 2019.
I understand some SIPP providers forward fund the +25% but others you wait until the SIPP provider gets paid by HMRC, as you say some 2mths later. When the +25% credit is added does not matter, the gross contribution is counted as made in 2018/19.

HHarry

Thanks Tom,


Yes 2018/19 earnings, so needs to go in before the end of this tax year.
Provider is Charles Stanley, who don't forward fund.


Good to know I can wait until April, get the max possible in, and not worry about the exact timing of the HMRC contribution.


Thank you.

Tom99

Check the Charles Stanley cut off time/date closer to April as it may be before 23:59 on the 5th.

Aiki

I thought that the tax relief was either 20% or 40% (or 45%), the rate depending on ones gross earnings.

NoMore

Aiki wrote: »

I thought that the tax relief was either 20% or 40% (or 45%), the rate depending on ones gross earnings.

It is.


You want to deposit £1000 Gross into a pension, so you deposit 800, the pension company claims back 200 (20% of 1000). 200 is also 25% of 800. That's what the OP is referring to, its still 20% relief on the gross.