SIPP contributions.

trickydicky14

As a retired person not working, I have a SIPP with HL just paying in the usual £2800 tax man puts his bit in then I draw it out job done.
I have left £1000 in the account during the first year as advised on this forum, come April I would like to put my next £2800 in but noticed the account indicates I can’t pay money in, I assume this is to do with the account being in drawdown?
How do I get the account up and running again come April?
Thanks for any help.

ColdIron

They disable your SIPP if it has no money in it and you used drawdown. Just give them a ring and they'll re-enable it for you
PS £2,880

bowlhead99

trickydicky14 wrote: »

I have left £1000 in the account during the first year as advised on this forum, come April I would like to put my next £2800 in but noticed the account indicates I can’t pay money in, I assume this is to do with the account being in drawdown?
How do I get the account up and running again come April?
Thanks for any help.

If you have told them that you don't have any earnings and you have already contributed the maximum amount that someone without any earnings can contribute for this tax year, it's presumably not an issue that it is indicating that you can't put any more in at the moment.

If when you get to Monday 6 April it still says you can't put any money in when you try (because they thought you were putting it into drawdown and wouldn't be adding again) just give them a call; they'll answer the phone within 30 seconds or so; you tell them you haven't contributed to the SIPP for a while but would like to put more money in now that it's a new tax year; they sort it out.

trickydicky14

Thanks Coldiron
Just to say, yes the account is in drawdown but I still have just over £1000 in the account.
I will give them a ring before April
And you are correct I should have said, £2,880.

trickydicky14

Thanks Bowlhead 99,
Point taken, what you say is totally logical as always.
Will hold back until April.

harrys66

sorry to hijack this thread, just a quick question.... To confirm I just need to confirm exactly how much *gross* PAYE I've earned between 6th April 19 to 5th April 20 and just I put the exact same monies into my H&L SIPP on the 6th?

Dazed_and_confused

sorry to hijack this thread, just a quick question.... To confirm I just need to confirm exactly how much *gross* PAYE I've earned between 6th April 19 to 5th April 20 and just I put the exact same monies into my H&L SIPP on the 6th?

Completely wrong sorry.

Other than in a few cases what you earn in the current tax year is irrelevant as far as how much you can contribute in a different tax year.

Not sure what you mean by gross PAYE but for most people their salary isn't the key figure for pension contributions it is taxable salary, the amount which goes on your P60.

And you make a net contribution to a SIPP so if you could contribute £5,000 gross you only pay over £4,000 and the pension company adds the 25% uplift.

You also need to factor in existing pension contributions from your employment.

This is all assuming you are talking about contributions eligible for tax relief at source.

harrys66

Dazed_and_confused wrote: »

Completely wrong sorry.

Other than in a few cases what you earn in the current tax year is irrelevant as far as how much you can contribute in a different tax year.

Not sure what you mean by gross PAYE but for most people their salary isn't the key figure for pension contributions it is taxable salary, the amount which goes on your P60.

And you make a net contribution to a SIPP so if you could contribute £5,000 gross you only pay over £4,000 and the pension company adds the 25% uplift.

You also need to factor in existing pension contributions from your employment.

This is all assuming you are talking about contributions eligible for tax relief at source.

Thanks, I think I understand now .....


I only have one small job earning less than the current tax allowance, and make no other pension contributions anywhere else.


So I just need to take the taxable figure from my P60 at the end of this year and make sure I put just the right amount of cash into my H&L SIPP (after the 6th april) so that once H&L add the tax relief, the final figure will add upto the figure on my P60 ?



Thanks again

Dazed_and_confused

So I just need to take the taxable figure from my P60 at the end of this year and make sure I put just the right amount of cash into my H&L SIPP (after the 6th april) so that once H&L add the tax relief, the final figure will add upto the figure on my P60 ?

No. Once the tax year has ended you have missed the opportunity to contribute to a SIPP and get tax relief for 2019:20.

If you choose to contribute on or after 6 April 2020 I.e. in the 2020:21 tax year, then the amount you can contribute will be based on your 2020:21 earnings.

Not really sure why you want to wait until 6 April??

What is the problem contributing between now and 5 April if this is true for the whole of the current tax year?

I only have one small job earning less than the current tax allowance, and make no other pension contributions anywhere else.

harrys66

Dazed_and_confused wrote: »

No. Once the tax year has ended you have missed the opportunity to contribute to a SIPP and get tax relief for 2019:20.

If you choose to contribute on or after 6 April 2020 I.e. in the 2020:21 tax year, then the amount you can contribute will be based on your 2020:21 earnings.

Not really sure why you want to wait until 6 April??

What is the problem contributing between now and 5 April if this is true for the whole of the current tax year?

Looks like I've got the wrong end of the stick last few years. but got away with it as I've been doing the minimum £2880 in the years before as this job only started near the end of the 2018-2019 tax year


So monies to be introduced to my SIPP will be ......


1) My expected P60 taxable figure at the end of this financial year - tax relief



2) Minus the £2880 I've already contributed on the 6th April 2019 (under the wrong assumption it was for the previous year)


Thank you


Can see now why its probably better to wait till near the end of the finanical year just in case your expected income changes up or down for whatever reason

Albermarle

Can see now why its probably better to wait till near the end of the finanical year just in case your expected income changes up or down for whatever reason

It is true that if you have unpredictable earnings you do not know the exact figure until late in the tax year, but nothing to stop you contributing on a regular basis during the year, with a final top up at the end .

Minus the £2880 I've already contributed on the 6th April 2019 (under the wrong assumption it was for the previous year)

You need to take away £3600 as this has what has gone into your pension ( £2880 + £720 tax relief)