Reclaim emergency tax from pension lump using form P53

Mr_Bojangles_3

I initiated the closure and full lump sum payment from an old pension policy on 20/03/2024. Obviously I was well aware I'd be liable for emergency tax, which I am now in the process of reclaiming. I received the payment on 10/04/2024. I'm assuming I now have to reclaim it using the 2024/25 tax year. 

Now to the P53 form where it is asking for income information for 24/25 etc.I am still in full time employment but haven't as yet been paid in the new tax year. So, I've entered 0 as my income so far. I've attached screenshots of my completed form if anyone would be so kind to take a look at it before I submit it.

[Deleted User]

You need to enter all of income that you expect to receive in the current tax year. Personally I don’t see how you would be in a position to claim any refund unless or until you can state that you have no further taxable  income to be received in this tax year - akin to a P50 claim - but I am open to correction as the P53 is new to me. 

See attached under 

‘Before you start’ 


https://www.gov.uk/guidance/claim-a-tax-refund-when-youve-taken-a-small-pension-lump-sum-p53

sheramber

If you will be liable to tax on your earnings then there won’t be a refund due on the pension payment. 

You may not have paid enough tax on it if some personal allowances were used against it with the emergency tax code. 

Dazed_and_C0nfused

sheramber said:

If you will be liable to tax on your earnings then there won’t be a refund due on the pension payment. 

You may not have paid enough tax on it if some personal allowances were used against it with the emergency tax code. 

If it was a big enough single payment then the 40/45% tax deducted could easily outweigh the months worth of Personal allowance that will have been duplicated.

But as ever it all depends on the precise details and it isn't crystal clear from the screenshot the op supplied.

[Deleted User]

Dazed_and_C0nfused said:

sheramber said:

If you will be liable to tax on your earnings then there won’t be a refund due on the pension payment. 

You may not have paid enough tax on it if some personal allowances were used against it with the emergency tax code. 

If it was a big enough single payment then the 40/45% tax deducted could easily outweigh the months worth of Personal allowance that will have been duplicated.

But as ever it all depends on the precise details and it isn't crystal clear from the screenshot the op supplied.

I had considered that too! Would this then simply be a matter of updating one’s personal tax account to show the expected income from all sources? 

Mr_Bojangles_3

My understanding is that I get charged emergency tax in case the pension payout takes me into the 40% tax band. 

My gross salary for 24/25 will be around 26k, so this along with the pension payout of 16k will leave me well below the threshold and thus should be due a refund.

mybestattempt

Mr_Bojangles_3 said:

My understanding is that I get charged emergency tax in case the pension payout takes me into the 40% tax band. 

My gross salary for 24/25 will be around 26k, so this along with the pension payout of 16k will leave me well below the threshold and thus should be due a refund.

You need to change the figure for employment income to the expected amount for 2024/25 of £26000 before submitting the form.

That way any refund will be the difference between the tax paid and the tax due on the taxable element of the pension withdrawal.