£3,600 annual contribution before or after tax relief

Enigmaman

I am wondering whether the £3600 maximum annual contribution that anyone with low or non-existent earnings is allowed to make is before tax relief is added, or after? i.e. can you in fact only pay in £3000, with the other £600 being taken care of by tax relief? Or is the £3600 before tax relief is applied?

molerat

You can pay in £2880 which is grossed up with £720 by the tax man to £3600. 20% of the gross £3600 equals 25% of the net £2880.

Dazed_and_C0nfused

There isn't a limit of £3,600 for people with "low" earnings.

There is a limit of £3,600 for people with no pensionable earnings or pensionable earnings of £3,600 or less.

If you earn £4,000 you can contribute £4,000 (inclusive of any relief at source added by the pension company).

xylophone

Non existent earnings? You contribute £2880 to your personal pension and the pension provider claims £720 and adds it to your pot. 

Only income earnings of say £10,000 - you can contribute up to £8000 and the pension provider claims up to £2000 and adds it to your pot.

dunstonh

Pensions are always treated as gross by HMRC.  So, £3600 gross.

i.e. can you in fact only pay in £3000, with the other £600 being taken care of by tax relief? 

Not sure how you came about that split.

It is £3600 gross which equates to £2880 net.