Self assessment pension contributions!

smirnoff1986

Hi everyone,
Bit of info first up, my salary is £50k and with overtime & bonuses I earned £55400. I pay in to a salary sacrifice pension at work with a 3% mandatory and an extra 9% AVC. My wife claims the child benifit and because I earn over 50k we have to pay some back. My question is, in section 4 on the tax return can I put in my pension contributions to bring my earnings below £50k?
Some people have said putting the pension contributions in lower the salary
while others are saying you can't! I've spoken to HMRC and they had no idea what I was talking about.
Thanks in advance.

greatkingrat

Is £55400 the figure from your P60 for last year? If your pension is salary sacrifice then the P60 figure will already be after pension contributions were deducted so you can't deduct them again.

smirnoff1986

Ah right thanks, yes the the 55400 is on the P60 as total for this year then tax reducted figure next to it of 10913.

xylophone

https://citywire.co.uk/funds-insider/news/earning-over-50k-you-dont-need-to-miss-out-on-child-benefit/a682507

https://www.gov.uk/child-benefit-tax-calculator

Funkyfreddy

You can't claim Tax Relief on your Salary Sacrifice Contributions as you never actually made them yourself to start with – the company made them on your behalf in exchange for a reduction in your salary so your final P60 figure for the year already takes account of these contribution as it were.

Even if your contributions weren't Salary Sacrifice but were deducted from your pay before the calculation of Income Tax under a “Net Pay Arrangement” then again your P60 figure would reflect your contributions had been deducted from your Total/Gross pay.

For the current Tax Year you could consider increasing your voluntary contribution if allowed – same as above if in SS or deducted from your pay before Tax then this they will be reflected in your Taxable (P60) pay for the year.

If they are deducted from your pay after Income Tax calculations you could put them down as additional Pension contributions on your SA which would adjust your Taxable income in the right direction - as would any contributions you make into a Personal Scheme you may start.

Dazed_and_confused

Funkyfreddy

Good explanation apart from one thing.

If they are deducted from your pay after Income Tax calculations you could put them down as additional Pension contributions on your SA which would adjust your Taxable income in the right direction - as would any contributions you make into a Personal Scheme you may start.

You would enter them on a Self Assessment return but most such contributions are "relief at source" and those do not reduce your taxable income. They do however reduce "adjusted net income", which is what the High Income Child Benefit Charge is calculated on.

For normal tax purposes they increase the amount of basic rate tax payable, which can in turn reduce any higher rate tax payable.

Funkyfreddy

I've seen you mention that before Dazed, well, quite regularly really - I must perhaps learn to change the way I try to describe it at times !

I make contributions into my workplace AVC Scheme which, if from payroll would be “Net Pay” but when made direct do not see “Relief at Source” relief so declare them on my SA and I always associate them with ultimately reducing my Taxable Pay as it were...

Cheers

Dazed_and_confused

It is possible to make a gross contribution and not receive any tax relief at the point of payment i.e. not "net pay" or "relief at source" although going off the posts on here and the Pensions board I think that is relatively unusual compared to net pay and relief at source.

Funkyfreddy

Yep, jf deducted through Payroll contribution sees Net Pay relief but if I make a contribution direct I dont see any at source relief.

I do get an acknowledgment that no relief has been given and its upto me to contact HMRC direct. Contribution goes in Box 3 of the TR section of a SA which itself says is "unusual" !