Payslips and P60: different practice for gross/taxable pay

aroominyork

I am preparing my and my wife's self-assessments. Our payslips and P60s are laid out differently. My payslip shows 'Total gross pay' and 'Gross for tax' as the same, both being total pay before pension contributions are taken off. My wife's payslip's cumulative 'Taxable pay to date' and P60 'Pay and income tax details: in this employment' show the amount after her pension contributions are deducted.

My workplace pension is with Nest; 80% of my contribution is deducted by my employer and Nest claim the other 20%. My wife's is with TPT/Benpal and the full amount is deducted by her employer. Is that the reason for the difference?

In any case, doesn't it mean that a P60 might give the wrong amount for self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off"?

Dazed_and_C0nfused

aroominyork said:

I am preparing my and my wife's self-assessments. Our payslips and P60s are laid out differently. My payslip shows 'Total gross pay' and 'Gross for tax' as the same, both being total pay before pension contributions are taken off. My wife's payslip's cumulative 'Taxable pay to date' and P60 'Pay and income tax details: in this employment' show the amount after her pension contributions are deducted.

My workplace pension is with Nest; 80% of my contribution is deducted by my employer and Nest claim the other 20%. My wife's is with TPT/Benpal and the full amount is deducted by her employer. Is that the reason for the difference?

In any case, doesn't it mean that a P60 might give the wrong amount for self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off"?

You need to check the method used to contribute as each provider can be different.

Nest is relief at source (RAS) and these contributions don't reduce your income for tax purposes.

TPT/Benpal sounds more like net pay, where the contributions does reduce the income for tax purposes.  Assuming your wife is actually contributing to a pension.

Have you any reason to think the P60 figures are wrong 🤔

aroominyork

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Dazed_and_C0nfused

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

You got 25% added by the pension company.  Did your wife?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

aroominyork

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

Dazed_and_C0nfused

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

You are missing a fundamental element here, your wife is not getting any pension tax relief.  You are.  That is the difference between the differing methods of pension contributions.

You get the pension tax relief (and increased basic rate band).  She gets less income to be taxed on.  And no pension tax relief and no change to her basic rate band.

There is no section on a tax return asking for details of "SIPP contributions".

Presumably you are referring to box 1 on the "Paying into registered pension schemes......." section.

With hindsight do you think you might have filled this in with the wrong figure (on your return).

aroominyork

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

You are missing a fundamental element here, your wife is not getting any pension tax relief.  You are.  That is the difference between the differing methods of pension contributions.

So is it correct that her P60 shows total pay as 95% of her total salary? And is that the figure for her self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off."? Likewise for me, is it correct that my P60 shows my full gross salary and is that the amount to show on self-assessment?

Dazed_and_C0nfused said:There is no section on a tax return asking for details of "SIPP contributions".

Presumably you are referring to box 1 on the "Paying into registered pension schemes......." section.

With hindsight do you think you might have filled this in with the wrong figure (on your return).

Yes, I am referring to that section. I only enter gross SIPP contributions there. Should I also enter gross workplace contributions? And does that apply to me and/or my wife? (As you can see I am not quite there yet - many thanks for this help.)

Dazed_and_C0nfused

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

You are missing a fundamental element here, your wife is not getting any pension tax relief.  You are.  That is the difference between the differing methods of pension contributions.

So is it correct that her P60 shows total pay as 95% of her total salary? And is that the figure for her self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off."? Likewise for me, is it correct that my P60 shows my full gross salary and is that the amount to show on self-assessment?

Yes, I am referring to that section. I only enter gross SIPP contributions there. Should I also enter gross workplace contributions? And does that apply to me and/or my wife? (As you can see I am not quite there yet - many thanks for this help.)

If she has paid 5% into a scheme operating net pay yes.

If you haven't made any net pay contributions then you wouldn't expect your P60 to show a lower figure.

Not sure where you are getting a difference between SIPP and workplace pensions from.  The tax return asks for details of contributions paid under the relief at source method (where the scheme adds basic rate tax relief).  That could be a workplace scheme.  Or a SIPP.  Or a stakeholder pension.  Or a personal pension.

The return is concerned with the method used.

Has your wife made any relief at source contribution?  If not then there is nothing, from what you have posted, for her to add with regard to pension contributions.

aroominyork

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

You are missing a fundamental element here, your wife is not getting any pension tax relief.  You are.  That is the difference between the differing methods of pension contributions.

So is it correct that her P60 shows total pay as 95% of her total salary? And is that the figure for her self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off."? Likewise for me, is it correct that my P60 shows my full gross salary and is that the amount to show on self-assessment?

Yes, I am referring to that section. I only enter gross SIPP contributions there. Should I also enter gross workplace contributions? And does that apply to me and/or my wife? (As you can see I am not quite there yet - many thanks for this help.)

Not sure where you are getting a difference between SIPP and workplace pensions from.  The tax return asks for details of contributions paid under the relief at source method (where the scheme adds basic rate tax relief).  That could be a workplace scheme.  Or a SIPP.  Or a stakeholder pension.  Or a personal pension.

The return is concerned with the method used.

Has your wife made any relief at source contribution?  If not then there is nothing, from what you have posted, for her to add with regard to pension contributions.

I was only thinking about SIPPs when completing "Payments to registered pension schemes (also known as PPR) where basic rate tax relief will be claimed by your pension provider (called 'relief at source')." So can you confirm that I should also include relief at source workplace contributions (but not net pay contributions)? And assuming it will not affect my tax band, does it matter if it is incorrect? Do I have to amend previously submitted returns?

My wife does make SIPP contributions and shows them on self-assessment under "Payments to registered pension schemes."

Dazed_and_C0nfused

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

Yes, most people do.  Nothing unusual in that.

That’s what confuses me. If my salary is taxed before my pension contributions are made, and then my withdrawals post-retirement are also taxed (aside from 25% tax free), aren't I paying tax twice?

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

You got 25% added by the pension company.  Did your wife?

No. Her full 5% contribution is deducted by the employer.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

But have you got a message further down your Self Assessment calculation saying your basic rate band has been increased from £37,700 to £38,835?

No. It is increased by a) the amount of gross SIPP contributions and b) Gift Aid payments. No reference to workplace pension.

Dazed_and_C0nfused said:

aroominyork said:

My wife contributes 5%.

But if payslips/P60s use different methods to calculate doesn’t it mean, for example, that relying on that figure to know your salary cap for SIPP purposes could give the wrong answer?

More importantly, I am wondering whether my workplace pension contributions have been taxed. My payslip for March 2024 shows, under ‘year to date’:

Total gross pay £55,283.00, Gross pay for tax £55,283.00, and then it shows pension deductions of £907.86. On my self-assessment (I’ve submitted mine but not my wife’s) under ‘View your calculation’ it shows:

Basic pay £43,463, made up of £55,283 + £750 other income less £12,570 personal allowance. And then it taxes that at 20% = £8692.60. Doesn’t that mean I have paid tax on my pension contributions?

NB.  I'm assuming your £907.86 is the net RAS contribution before basic rate tax relief is added.

Yes, it is.

You are missing a fundamental element here, your wife is not getting any pension tax relief.  You are.  That is the difference between the differing methods of pension contributions.

So is it correct that her P60 shows total pay as 95% of her total salary? And is that the figure for her self-assessment under "Pay from this employment - the total from your P45 or P60 - before tax was taken off."? Likewise for me, is it correct that my P60 shows my full gross salary and is that the amount to show on self-assessment?

Yes, I am referring to that section. I only enter gross SIPP contributions there. Should I also enter gross workplace contributions? And does that apply to me and/or my wife? (As you can see I am not quite there yet - many thanks for this help.)

Not sure where you are getting a difference between SIPP and workplace pensions from.  The tax return asks for details of contributions paid under the relief at source method (where the scheme adds basic rate tax relief).  That could be a workplace scheme.  Or a SIPP.  Or a stakeholder pension.  Or a personal pension.

The return is concerned with the method used.

Has your wife made any relief at source contribution?  If not then there is nothing, from what you have posted, for her to add with regard to pension contributions.

I was only thinking about SIPPs when completing "Payments to registered pension schemes (also known as PPR) where basic rate tax relief will be claimed by your pension provider (called 'relief at source')." So can you confirm that I should also include relief at source workplace contributions (but not net pay contributions)? And assuming it will not affect my tax band, does it matter if it is incorrect? Do I have to amend previously submitted returns?

My wife does make SIPP contributions and shows them on self-assessment under "Payments to registered pension schemes."

Yes, you should include any RAS contributions.

Net pay contributions aren't something you include on the return.

You can only amend the 2022-23 return now, any changes for earlier returns have to submitted in writing in a prescribed format. 

But if there is no tax consequence of any sort not really worth the bother.  Gov.uk has full details in the Write to HMRC section here,

https://www.gov.uk/self-assessment-tax-returns/corrections

aroominyork

And there is no tax implication if I have made SIPP contributions that make all my salary fall within the basic rate tax band - is that right?

Also (and maybe finally), is it right that my wife can make gross pension contributions (net pay + SIPP) totalling a higher amount than her salary shown on her self-assessment (ie exceeding salary cap based on self-assessment) since self-assessment only records 95% of her gross salary?