Earnings cap for pension tax relief

Sarahspangles

lassfarfromhome said:

Thanks all.  There seems (unless I'm misunderstanding) to be a difference of opinion between NoMore and Triumph13 on the one hand, who say I can put in 80k in my example and get tax relief, and DazedandConfused on the other hand who says I can only put in 75k and get tax relief.  You are obviously all extremely knowledgable so not sure where to go from here....but thanks for all assistance so far!

This page clearly describes what ‘relevant UK earnings’ means and that salary sacrifice amounts don’t count. As they aren’t liable for tax, they can’t be ‘relieved’ of that tax.

https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/tax-relief-and-your-pension

lassfarfromhome

Dazed_and_C0nfused said:

lassfarfromhome said:

Thanks all.  There seems (unless I'm misunderstanding) to be a difference of opinion between NoMore and Triumph13 on the one hand, who say I can put in 80k in my example and get tax relief, and DazedandConfused on the other hand who says I can only put in 75k and get tax relief.  You are obviously all extremely knowledgable so not sure where to go from here....but thanks for all assistance so far!

As, based on what you posted, your P60 (or P45) is only going to show taxable earnings of £75k I fail to see how you can contribute more than that (for tax relief purposes).

-My gross earnings this year are 80k

-My salary sacrifice contributions to my workplace pension were £5k

Ah, I see where the confusion arises- from my poor drafting, sorry about that.  I meant that the taxable earnings on my p45 were £80k but there was £5k on top of that by salary sacrifice.  I think we are all agreed, then, that based on the figures in my example (which were simplified for convenience) I can get tax relief on 80k.  Thanks everyone

lassfarfromhome

Sarahspangles said:

lassfarfromhome said:

Thanks all.  There seems (unless I'm misunderstanding) to be a difference of opinion between NoMore and Triumph13 on the one hand, who say I can put in 80k in my example and get tax relief, and DazedandConfused on the other hand who says I can only put in 75k and get tax relief.  You are obviously all extremely knowledgable so not sure where to go from here....but thanks for all assistance so far!

This page clearly describes what ‘relevant UK earnings’ means and that salary sacrifice amounts don’t count. As they aren’t liable for tax, they can’t be ‘relieved’ of that tax.

https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/tax-relief-and-your-pension

Thanks Sarah!  

NoMore

Dazed_and_C0nfused said:

lassfarfromhome said:

Thanks all.  There seems (unless I'm misunderstanding) to be a difference of opinion between NoMore and Triumph13 on the one hand, who say I can put in 80k in my example and get tax relief, and DazedandConfused on the other hand who says I can only put in 75k and get tax relief.  You are obviously all extremely knowledgable so not sure where to go from here....but thanks for all assistance so far!

As, based on what you posted, your P60 (or P45) is only going to show taxable earnings of £75k I fail to see how you can contribute more than that (for tax relief purposes).

-My gross earnings this year are 80k

-My salary sacrifice contributions to my workplace pension were £5k

NoMore said:

Are the gross earnings your quoting before or after the salary sacrifice ?

lassfarfromhome said:

The gross earnings of 80k is after salary sacrifice has been taken off.