Split Year Treatment and Extra Pension Contributions

dean350

I returned to UK from working overseas last year and thus will claim split year treatment for 24/25 tax year. For the UK portion of the year, I will have salary sacrified and received employer contributions of about 22K into my pension by April. However, I understand I could top that up to 60K for the year. If I added a further 28K from  my savings would that then have the 7K tax relief added to it?

QrizB

How much taxable income do you expect to have from your UK job during the 24/25 tax year?

Marcon

dean350 said:

I returned to UK from working overseas last year and thus will claim split year treatment for 24/25 tax year. For the UK portion of the year, I will have salary sacrified and received employer contributions of about 22K into my pension by April. However, I understand I could top that up to 60K for the year. If I added a further 28K from  my savings would that then have the 7K tax relief added to it?

The actual source doesn't matter, but your 'relevant earnings' do. How much are your UK taxable earnings in this tax year?

Alternatively, do you have scope to salary sacrifice more without falling foul of minimum wage requirements, drawing on your savings to supplement your reduced salary?

dean350

Its on an annual salary of 65K but only started in UK at beginning of September 24 so will have clocked up 8 months by end of tax year

QrizB

dean350 said:

Its on an annual salary of 65K but only started in UK at beginning of September 24 so will have clocked up 8 months by end of tax year

Is that £65k before salary sacrifice, or after? Salary sacrifice reduces your gross salary.

dean350

Thats before sacrifice

Marcon

dean350 said:

Thats before sacrifice

What is it after sacrifice?

Dazed_and_C0nfused

dean350 said:

Thats before sacrifice

The pay you expect to be shown on your P60 for the year to 5 April 2025 will be useful information.

dean350

After sacrifice my salary is 24K which is just above min wage of 22K for my 37 hour per week contract.

Dazed_and_C0nfused

dean350 said:

After sacrifice my salary is 24K which is just above min wage of 22K for my 37 hour per week contract.

Then £24k will be your limit for tax relief.

£24k being the gross amount, not the amount you actually transfer to the pension company from your bank account.

dean350

Thanks. I do understand now that although you can put in 60K gross you will only get the 20% uplift on the amoount that corresponds to your earnings.