Railway Pension Scheme Website - BRASS Payments/Tax

SJG1

xylophone said:

From A Guide for Members of Brass

Like your contributions to the Scheme, BRASS contributions are taken from your pay before you pay income tax. This reduces the real cost to you.  By using the Network Rail payroll system, you can contribute up to 75% of your contribution limit and automatically benefit from tax relief. If you wish to contribute more than 75%, you can make supplementary contributions by BACS transfer or cheque direct to RPMI. If you pay any contributions by either of these methods it is your responsibility to reclaim any tax from contributions you pay directly from HMRC.  The OP needs to explain to HMRC that he has made a contribution to the scheme after  he has paid tax on it? This problem seems to come up again and again after members of pension schemes operating "net pay" want to make a contribution as though on a RAS basis.

A guide for members of BRASS (Network Rail section)

Thanks. I'm not in the Network Rail Section (South Western Railway one) but at least it gives me something to add as an example when I next speak to HMRC. Also shows I do need to go through HMRC as well.
I did try to explain to the online chat adviser but he was adamant that I wasn't entitled to any tax on a gross contribution etc. Hopefully when I get the written explanation I requested from HMRC they will realise their mistake/misunderstanding though not holding my breath.

Dazed_and_C0nfused

xylophone said:

I wonder could he write to HMRC citing the information above from the handbook and explaining that he has not received tax relief on the contribution of £300 that he has made?

I think that is the best option.

I suspect phoning again will only result in frustration for the op.

SJG1

Sorted   New tax code on its way. 
So if anyone else is having the same problem the wording you need is "Concessional Relief". Definitely not well known in the HMRC world as the advisor I was speaking to hadn't heard of it before but was very helpful.

xylophone

"Concessional Relief".

https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye130025#IDA0H2PE
You will also need to record any other relief as Concessional relief where no other coding item exists, see PAYE11110.

• Create a BF (PAYE105520) with a review date after the end of the tax year

Example: Relief due on gross superannuation payments

For 2008-2009 individual has made a £1,000 gross lump sum payment to a superannuation scheme and relief has not been given through the net pay arrangement and you have established that tax relief is due using the Pension Tax Manual (see Pension Tax Manual (PTM) at PTM044240). Generally in these cases tax relief is given through the Self Assessment system.

If an employee requests that tax relief be given in their tax code for the current year, you should

* Enter the gross amount paid £1,000 as Concessional relief
* Make a Contact History note of the lump sum payment
* Set the Inhibit Automatic Reconciliation indicator for CY
* Create a BF with review date in CY+1

When the BF is reviewed, you will need to

* Confirm the amount of the lump sum payment from the Contact History note
* Amend the Concessional relief to nil
* Enter the gross payment as RAR for the year of reconciliation only

Note: This will ensure the correct amount of tax relief is given in the final tax liability for the year in which the payment was made. See PAYE93090 for more information.