Do I have to file for Self Assessment?

frugalandsave

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

TheBanker

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

Albermarle

You can check here whether you need to fill in a self assessment tax return or not.
If the answer is no, then as above you just need to inform HMRC of your gross pension contributions ( your contributions plus the basic rate tax relief) 
Check if you need to send a Self Assessment tax return - GOV.UK (www.gov.uk)

Dazed_and_C0nfused

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

No idea why your employer told you that as they won't know for certain if you need to complete a tax return.

Also, there is no "additional 20%".  Contributions to a RAS scheme will increase your basic rate band meaning more tax can be paid at 20% and less at 40% but relief is limited by the higher rate tax you would have been paying.

So contribute say £8k gross whilst paying higher rate tax on say £2k will result in a typical refund of £400 not £1,600.

MDMD

TheBanker said:

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

The £100k limit was raised to £150k last week

https://www.icaew.com/insights/tax-news/2023/may-2023/changes-to-self-assessment-criteria

https://www.gov.uk/government/publications/agent-update-issue-108/issue-108-of-agent-update#sa-threshold-change

TheBanker

MDMD said:

TheBanker said:

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

The £100k limit was raised to £150k last week

https://www.icaew.com/insights/tax-news/2023/may-2023/changes-to-self-assessment-criteria

https://www.gov.uk/government/publications/agent-update-issue-108/issue-108-of-agent-update#sa-threshold-change

I hadn't spotted that. It takes me out of SA so thank you.

But a question... I thought the reason £100k+ earners had to do a Self Assessment return was to deal with the way your personal allowance reduces based on earnings over £100k. So how will this be dealt with in future?

MDMD

TheBanker said:

MDMD said:

TheBanker said:

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

The £100k limit was raised to £150k last week

https://www.icaew.com/insights/tax-news/2023/may-2023/changes-to-self-assessment-criteria

https://www.gov.uk/government/publications/agent-update-issue-108/issue-108-of-agent-update#sa-threshold-change

I hadn't spotted that. It takes me out of SA so thank you.

But a question... I thought the reason £100k+ earners had to do a Self Assessment return was to deal with the way your personal allowance reduces based on earnings over £100k. So how will this be dealt with in future?

They will likely just do a normal P800 assessment - they are aiming to remove as many people from SA as they can

Dazed_and_C0nfused

TheBanker said:

MDMD said:

TheBanker said:

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

The £100k limit was raised to £150k last week

https://www.icaew.com/insights/tax-news/2023/may-2023/changes-to-self-assessment-criteria

https://www.gov.uk/government/publications/agent-update-issue-108/issue-108-of-agent-update#sa-threshold-change

I hadn't spotted that. It takes me out of SA so thank you.

But a question... I thought the reason £100k+ earners had to do a Self Assessment return was to deal with the way your personal allowance reduces based on earnings over £100k. So how will this be dealt with in future?

It will be this process which happens for everyone who doesn't need to complete a tax return.

https://www.gov.uk/tax-overpayments-and-underpayments

Pat38493

TheBanker said:

MDMD said:

TheBanker said:

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

You can complete the Self Assessment form from 6 April (i.e. the day after the end of the tax year). The deadline for online returns is 31 January the following year, although the general advice is not to leave it until the last minute in case you realise you have some missing information, or have internet problems or whatever.

Just to confirm though, you don't need to do a Self Assessment return to reclaim back higher rate tax on pension contributions. You contact HMRC and ask them to adjust your tax code to reflect the contributions. BUT, if you're earning over £100k you will have to do a Self Assessment form anyway, and if you do it will deal with the pension tax relief for you. 

The 20% doesn't go into the pension, it's either refunded by adjusting your tax code so you pay less tax in future, or payign you direct. You can, of course, choose to add the refund to your pension, in which case it qualifies for a further slice of tax relief. 

The £100k limit was raised to £150k last week

https://www.icaew.com/insights/tax-news/2023/may-2023/changes-to-self-assessment-criteria

https://www.gov.uk/government/publications/agent-update-issue-108/issue-108-of-agent-update#sa-threshold-change

I hadn't spotted that. It takes me out of SA so thank you.

But a question... I thought the reason £100k+ earners had to do a Self Assessment return was to deal with the way your personal allowance reduces based on earnings over £100k. So how will this be dealt with in future?

This was what I used to think as well, but I was told that the PAYE system can deal with the removal of personal allowance form 100K without doing a tax return (although I have to say that I'm a bit dubious about that having ended up with extra tax to pay several times when I earned over 100K).  These days I am managing my income to make sure it's not above 100K as I don't like paying 60% tax.

Qyburn

frugalandsave said:

My new employeer confirmed that I will have to do a Self assessment to claim the additional 20 %. I kicked of the discussion to see whether it is possible to implement Salary Sacrifice for the future. In the meantime, when would I usually have to do self assessment in order to claim back the 20 % into the pension? Thx

Just as an example for 22/23 I did mine on 24th April and received the tax refund in early May. I'd been increasing pension contributions to take me out of HR tax for a few years, but I noticed for the first time last year HMRC had adjusted my tax code to allow for this.