2015 NHS pension + SIPP

AnonFIREUK

Currently higher rate tax payer around 56k this year contributing to NHS pension. I want to put higher rate into SIPP but unsure how to calculate the tax relief.

Just to check.As a quick example I am around 10k above higher rate tax. Normally I would put 80% into SIPP then autoclaim 20%, then ter further 20% from HMRC

The fact that I am contributing to NHS pension complicates this and I how to calculate this so I know how much of the 10k had already been used for tax relief for the NHS pension?

Many thanks

Pocket9s

NHS pension contribution will be 12.5% so might bring you below 50k threshold depending on exact salary. Basically once your reach top two spine points of an 8b or higher you will need to pay separately into a personal pension to avoid the higher rate bracket

AnonFIREUK

Just to clarify the NHS tax relief is just the % multiplied by total salary? And is the calculation for contributions the % + employers x salary?
Just in terms of the SIPP. Do I deposit 80% or 60%?

Dazed_and_confused

There are a few misleading things in this thread.

Firstly forget your "salary". It is irrelevant for tax purposes. It is your taxable pay/salary which counts i.e. the pay figure shown on your P60. Plus any other taxable income in the tax year such as savings interest, rental income, dividends etc.

HMRC do not refund an extra 20% tax relief on relief at source pension contributions. The gross contribution (your payment plus the basic rate tax relief added to the pension fund) increases the amount of basic rate tax you can pay in the year, which in turn reduces the amount of higher rate tax which would be charged.

This may be 20% but as it is part of your overall annual tax calculation it is unlikely to be exactly 20%.

Any additional tax relief due benefits the person contributing to the pension, by either a tax refund or reduction in any tax otherwise owed. It is not added to the pension fund.

AnonFIREUK

So how much do I have to deposit into my SIPP for the higher rate? Am I right in thinking taxable pay - 46350 will be the tax I am paying at 40%. Do I need to pay 60% or 80% of this figure into my SIPP?

AnonFIREUK

So how much do I have to deposit into my SIPP for the higher rate? Am I right in thinking taxable pay - 46350 will be the tax I am paying at 40%. Do I need to pay 60% or 80% of this figure into my SIPP? And when I tell HMRC do I give the gross figure?

darkidoe

Check this thread out: https://forums.moneysavingexpert.com/discussion/5965768/call-hmrc-for-claiming-pension-tax-relief