Child Benefit - Pension Contributions

danhenshy23

Hi,

I am restarting my Child Benefit claim as I earn between the £60k and £80k threshold.

Since claiming Child Benefit last, I have moved to a salary sacrifice pension scheme where pension contributions are made from my gross salary.

Reading the MSE article on Child Benefit it states:

"Employer pension scheme: If it goes straight from your before-tax ('gross') pay into a pension, for example an employer pension scheme, you can deduct that same gross amount."

This however seems to contradict the HMRC advice I have found online where they state:

"If the pension contribution is taken from your net pay then yes this can be deducted for the adjusted net income.

If the pension contributions are taken from your salary before the tax is calculated then in this case you would not be able to deduct as relief already given at source."

Can anyone here confirm if they have previously used Gross pension contributions made through a salary sacrifice scheme to adjust their net income?

kaMelo

danhenshy23 said:

Hi,

I am restarting my Child Benefit claim as I earn between the £60k and £80k threshold.

Since claiming Child Benefit last, I have moved to a salary sacrifice pension scheme where pension contributions are made from my gross salary.

Reading the MSE article on Child Benefit it states:

"Employer pension scheme: If it goes straight from your before-tax ('gross') pay into a pension, for example an employer pension scheme, you can deduct that same gross amount."

This however seems to contradict the HMRC advice I have found online where they state:

"If the pension contribution is taken from your net pay then yes this can be deducted for the adjusted net income.

If the pension contributions are taken from your salary before the tax is calculated then in this case you would not be able to deduct as relief already given at source."

Can anyone here confirm if they have previously used Gross pension contributions made through a salary sacrifice scheme to adjust their net income?

Where on MSE does it say that?

The only pension contributions which can be deducted when working out your adjusted net pay are those made via relief at source.
Salary sacrifice and net pay contributions are deducted prior to tax and NI is deducted, they automatically reduce you're gross pay so you can't deduct them again. The only difference being salary sacrifice are employer contributions whereas net pay contributions are employee.


ETA I found it. You only quoted half the paragraph, the second half is quite important.

Employer pension scheme:
If it goes straight from your before-tax ('gross') pay into a pension, for example an employer pension scheme, you can deduct that same gross amount. Usually the figure on your P60 will already reflect the deduction and is the amount to enter in the adjusted net income calculation with no further deduction. 

Phoenix72

There are no adjustments needed for salary sacrifice. Salary sacrifice means you are giving up salary in exchange for employer contributions to your pension scheme. The amounts of taxable pay reported to HMRC are the amounts after sacrifice so nothing further you need to do.