Should I take my state pension?

MallyGirl

she can only contribute what she earns

xylophone

With regard to your own situation, you  say that you are a 40% tax payer and that your pension contributions are "relief at source".

Did you read the link in my previous explaining the difference between "relief at source "and net pay" and the need to claim additional tax relief?

More here

https://getpenfold.com/news/claim-higher-rate-pension-tax-relief

and here

https://www.unbiased.co.uk/discover/pensions-retirement/managing-a-pension/how-to-claim-higher-rate-tax-relief-on-pension-contributions#:~:text=Can I claim tax relief,the last four tax years.

Regarding reaching state pension age and continuing to work

https://www.gov.uk/tax-national-insurance-after-state-pension-age/stopping-paying-national-insurance

Re your state pension, will it be more or less than £221.20 a week?

Re deferring your state pension

https://www.telegraph.co.uk/money/pensions/tax-retirement/deferring-your-state-pension-can-give-you-higher-payments/

https://www.thisismoney.co.uk/money/pensions/article-4565554/If-delay-state-pension-die-heirs-lose-out.html

Re your wife's pension contributions,  let's suppose  her only income is £12,000 a year from her part time job.

She pays no tax.

Nevertheless she may contribute up to  £9600 to a "relief at source" scheme and the provider will claim up to £2400 in tax relief and add it to her pot.

johntin11

Xylophone, thanks for the information, I will try to work my way through the above information along with my wife.
I should have mentioned that in addition to the £400 a month that I pay my wife to put it into her pension. Through her work she puts approximately £1000 a year into her company pension.  This year just before the new tax year I have also paid another £7000 into her pension. 

johntin11

Reading your message above, I think I might have broken her limit and paid more into her pension Than she earns.
£7000 cash
£400 × 12= £4800
£1000 work pension
She earns approximately £13000 she tells me.
I thought the amount she could put into her pension was what she earned and not what she earns plus the tax relief.

xylophone

If her relevant earnings are £13,000 per annum and she contributes to a "relief at source" pension scheme then the total she can   contribute to the pension is up to  £10,400 - the provider will claim tax relief of up to   £2600 and add it to her pot.

Thus if last year her relevant earnings  were £13000 and  she contributed £1000 through payroll, she could still have made an additional contribution of up to £9400.

johntin11

What happens to the excess that I have paid in?  Will she will be taxed on it and will the remainder stay in her pot? Or do they refund the excess payment?

xylophone

Does your wife receive an annual pension statement?

She can contact the administrator and explain the circumstances.

https://getpenfold.com/pension-guides/how-much-can-i-pay-into-my-pension

johntin11

Thank you for your the link and your help. I think we will just have to take the hit and pay back the relevant tax relief on the overpayment.

xylophone

What will your weekly SP be if you bring it into payment?

Do you expect to be  a basic rate tax payer once you stop work?

johntin11

I will have a full state pension and I will topping up my wife's state pension.
We will both be trying to stay in the 20% band and we will be drip feeding our tax free part for extras etc.