SIPP Non-Taxpayer Tax Relief

RolandFlagg

I pay in £240 into a SIPP with HL spread over a number of funds, and with tax relief it is topped up to £300.
As a non-taxpayer I understand that is the maximum amount of tax relief I will receive and increasing my monthly amount will not further increase the amount of tax relief.
Is that correct? And if so is there legal or grey area way around this? 
At the moment I pay another £500 direct to Vanguard's own platform for a LS60 and obviously do not receive further tax relief on that.
Is there a more tax efficient way of paying in £800-£1000 a month into funds?

SonOf

I pay in £240 into a SIPP with HL spread over a number of funds, and with tax relief it is topped up to £300.
Technically, you are paying £300pm and getting tax relief of £60.    It may seem semantics but pensions are treated as gross contributions for tax purposes.

As a non-taxpayer I understand that is the maximum amount of tax relief I will receive and increasing my monthly amount will not further increase the amount of tax relief. Is that correct?
yes

And if so is there legal or grey area way around this? 
get a job that pays more than £3600 a year.

Is there a more tax efficient way of paying in £800-£1000 a month into funds?
Pension, then S&S ISA, then unwrapped holdings.

soulsaver

FTAOD £3600 is not an annual pension contribution allowed for a 'non-taxpayer'; it is non earner allowance.  
So, if you are earning you can pay in upto your gross earnings *- so if you earn £12500 pa and have £12500 personal allowance, so don't pay tax, you can still put £12.5k (you put £10k and hmrc put £2.5k) into your SIPP.

dont_look_now

Assuming you do have no (or less than £3,600 of) taxable employment / self-employment income in the current tax year, I think the only other question is how many monthly contributions of £240(+£60) will you make in this tax year? Because if you just set this up, and will have made less than 12 contributions this tax year, then you could also make a one-off contribution to take your total contributions up to the maximum of £2,880(+£720). Though you couldn't repeat this next tax year.

xylophone

Though you couldn't repeat this next tax year.

He could make another lump sum contribution of £2880 into the SIPP as soon as the new tax year begins - the total tax relief of £720 would be added as a lump sum.

That said, it is not clear whether or not the OP has any "relevant earnings" which would enable a contribution in excess of "the basic amount".

https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm044100

Supposing the OP were under 75 and his only income was a salary of £10000 per annum.

He would not pay tax because his income is under his personal allowance.

Nevertheless, he could contribute a net £8000 to his SIPP and receive TR of £2000.

dont_look_now

xylophone said:

Though you couldn't repeat this next tax year.

He could make another lump sum contribution of £2880 into the SIPP as soon as the new tax year begins - the total tax relief of £720 would be added as a lump sum.

Yes, though that would be instead of continuing monthly contributions during next tax year, not as well as continuing them. (All assuming the OP doesn't have relevant earnings > £3,600.)