Tax Relief Question

littleboo

HI,

Can someone clarify the position for someone, in this case a self employed person intending to start paying into into a stakeholder pension scheme, wrt to tax relief? The Money Advice Service says
"If you have no earnings or earn less than £3,600 a year, you can still pay into a pension scheme and qualify to have tax relief added to your contributions up to a certain amount."
But what if you earn more than £3600 and less than than the 20% threshold, say £10 p/a,whats the position with tax relief on contributions, given that no tax is being paid ?

Thanks in advance

Dazed_and_confused

What you "earn" has no relevance.

It is your profit which counts.

If your profit is £10,000 then you can contribute £8,000 to a relief at source pension and the pension company will add £2,000 basic rate tax relief giving you £10,000 in your pension fund. Even if you pay no income tax.

xylophone

https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/tax-relief-members-contributions/


The above includes an explanation for the self employed.