Claimed too much tax relief on pension contributions

SaracenCat

My self-employed husband has a SIPP with AJ Bell. He makes net contributions into it and then AJ Bell claims the tax relief from HMRC on his behalf. In 2023/24 he made £22k (gross) pension contributions on which he claimed tax relief. But after the tax year ended, we did his accounts and prepared a draft of his tax return, and it turned out his net profit was lower than expected: only £20k. So now he should pay back that extra tax relief. I think this can be done via his tax return, is that right?

On the tax return, we've completed the relevant questions about pension contributions, so in theory HMRC will have all the necessary info. I thought this would prompt HMRC to claw back the overpaid tax relief, but it doesn't seem to have done that. There's no line on the calculation indicating they'll deduct it from the rebate he's due.

The return is still a draft; we haven't submitted it yet because we're not sure whether there's something else we have to do.

Thanks for any help!

Sara

zagfles

I don't think the tax return sorts this out - you need to contact the SIPP provider, and either tell them of the excess contributions so they return the tax relief, or ask for a refund of the excess contributions. See PTM045000 - Contributions: refunds of contributions - HMRC internal manual - GOV.UK (www.gov.uk) 

Phoenix72

No, the Tax Return doesn't sort these issues out so, as above, you need to tell the pension company.

SaracenCat

Thanks to both of you! That's very helpful.