Any views on NEST?

LV_426

Marcon said:

ajfielden said:

Albermarle said:

The terminology can be confusing .

Relief at source - means your contributions are taken from your pay after tax . The pension provider will add back in tax relief at 20% . If you are due some higher rate tax relief then you have to claim this back from HMRC and any rebate comes back to you directly . 

I think a previous employer was operating this scheme, but I was clueless, and didn't reclaim the higher rate tax. Can I claim it retrospectively if I ask HMRC nicely?

You can claim back up to four years after the end of the tax year to which your claim relates. Either do so on your self assessment tax return, or ring HMRC (good luck with that!). 

Looks like I've blown it then. Oh well never mind. Don't really want to waste my life hanging on the phone to HMRC.
But I've learned something new about different pension contrib setups. Something to look out for when I start my new job. Hopefully it's a 'net pay' scheme (definitely confusing terminology!)

Marcon

ajfielden said:

Marcon said:

ajfielden said:

Albermarle said:

The terminology can be confusing .

Relief at source - means your contributions are taken from your pay after tax . The pension provider will add back in tax relief at 20% . If you are due some higher rate tax relief then you have to claim this back from HMRC and any rebate comes back to you directly . 

I think a previous employer was operating this scheme, but I was clueless, and didn't reclaim the higher rate tax. Can I claim it retrospectively if I ask HMRC nicely?

You can claim back up to four years after the end of the tax year to which your claim relates. Either do so on your self assessment tax return, or ring HMRC (good luck with that!). 

Looks like I've blown it then. Oh well never mind. Don't really want to waste my life hanging on the phone to HMRC.
But I've learned something new about different pension contrib setups. Something to look out for when I start my new job. Hopefully it's a 'net pay' scheme (definitely confusing terminology!)

Couldn't agree more! NEST is relief at source, so you'll need to claim higher rate tax relief on personal contributions (not necessary if contributions are all made by salary sacrifice, since these are classed as employer contributions so are paid gross). 

Marcon

Alexland said:

Thrugelmir said:

The employer gets no cut of your NIC saving though.  Are you prepared to pool it and take a 50/50 share of the overall net saving once the employer covers the full administrative cost of employing someone ?

The cost of employing soneone should be covered by the business activity that justified the role being created and maintained not by keeping a share of the benefits of an employee arranging their affairs to be more tax efficient.

Part of any business's activity is keeping payroll costs under control, so any employer NI savings will be factored in, based on a 'best estimate' of how many people will take up pension scheme membership/how much they will contribute.

LV_426

Marcon said:

ajfielden said:

Marcon said:

ajfielden said:

Albermarle said:

The terminology can be confusing .

Relief at source - means your contributions are taken from your pay after tax . The pension provider will add back in tax relief at 20% . If you are due some higher rate tax relief then you have to claim this back from HMRC and any rebate comes back to you directly . 

I think a previous employer was operating this scheme, but I was clueless, and didn't reclaim the higher rate tax. Can I claim it retrospectively if I ask HMRC nicely?

You can claim back up to four years after the end of the tax year to which your claim relates. Either do so on your self assessment tax return, or ring HMRC (good luck with that!). 

Looks like I've blown it then. Oh well never mind. Don't really want to waste my life hanging on the phone to HMRC.
But I've learned something new about different pension contrib setups. Something to look out for when I start my new job. Hopefully it's a 'net pay' scheme (definitely confusing terminology!)

Couldn't agree more! NEST is relief at source, so you'll need to claim higher rate tax relief on personal contributions (not necessary if contributions are all made by salary sacrifice, since these are classed as employer contributions so are paid gross). 

Good to know, thanks for the heads up. It's definitely something I'll be on top of now, come the end of the tax year.

Albermarle

ajfielden said:

Marcon said:

ajfielden said:

Marcon said:

ajfielden said:

Albermarle said:

The terminology can be confusing .

Relief at source - means your contributions are taken from your pay after tax . The pension provider will add back in tax relief at 20% . If you are due some higher rate tax relief then you have to claim this back from HMRC and any rebate comes back to you directly . 

I think a previous employer was operating this scheme, but I was clueless, and didn't reclaim the higher rate tax. Can I claim it retrospectively if I ask HMRC nicely?

You can claim back up to four years after the end of the tax year to which your claim relates. Either do so on your self assessment tax return, or ring HMRC (good luck with that!). 

Looks like I've blown it then. Oh well never mind. Don't really want to waste my life hanging on the phone to HMRC.
But I've learned something new about different pension contrib setups. Something to look out for when I start my new job. Hopefully it's a 'net pay' scheme (definitely confusing terminology!)

Couldn't agree more! NEST is relief at source, so you'll need to claim higher rate tax relief on personal contributions (not necessary if contributions are all made by salary sacrifice, since these are classed as employer contributions so are paid gross). 

Good to know, thanks for the heads up. It's definitely something I'll be on top of now, come the end of the tax year.

When your submit your claim/tax return after the end of the tax year,  then you should get a rebate sometime later in 2022.
Then they will also increase your tax code for 22/23 on the assumption you will make similar pension contributions each year.
So no further rebates will be necessary in subsequent years . Instead you will get increased take home pay .
If you increase/reduce the contributions significantly you need to to tell HMRC, otherwise you will pay too little/too much tax.