One-off Contribution to Scottish Widows Pension

Empor

I'd like to use a bit more of my annual pension allowance this tax year and make a one-off contribution to my scheme at Scottish Widows.

Does anyone know when a payment gets credited - is it immediately they receive the cash? e.g. if I send it on 5th April as a same day payment would that hit the 2018/19 tax year?

Albermarle

Normally it is quick but not sure if it would be actually be the same day , probably best to give them one working day at least.

bowlhead99

Safest thing to do is ask them. However, remember that you have the ability to carry forward contribution limits to future years if you don't use up your full limit and you have enough earnings in the future years to be allowed to make the contributions.

For example, you are talking about using 'a bit more' of this year's allowance, let's pretend that's £5k. If the money wasn't credited this year so you only used say £30k of your £40k allowance for this year instead of £35k as you planned... for 2019/20 you'd have £40k allowance available, plus £10k carry forward (subject to having enough earnings in 2019/20), instead of £40k allowance plus £5k carry forward... so the fact that your contribution falls into next year doesn't actually stop you meeting your objectives if you're not the sort of person who maxes out their allowance every year.

If you are a high rate taxpayer who really wants to do a tax return ASAP and get back the extra tax relief on the contribution quickly rather than waiting another year, there is some tangible benefit in making sure you definitely catch the tax year end. But for many people it wouldn't matter too much in practice. That may colour your judgement in terms of whether it's worth your time picking up the phone to the pension company and waiting on hold for a while, to ask.