Additional Rate Tax Relief Calculation

HMRC_Complication

Hi all,

First post on the MSE Forum . 

Can someone help me understand the calculation for Additional Rate Tax Relief? 

I calculated it as 25% of Total Employee Contribution in my 23-24 Self Assessment however I've been told by a friend that this should in fact have been 25% of Total Gross Contribution (Employee + Employer + Basic Relief). I have tried to find out the correct calculation method online and found conflicting information so turning to the forum for some clarity. 

In addition to potentially revising my 23-24 SA, I will be submitting an Overpayment Relief claim for 21-22 and 22-23 as I did not claim Additional Rate Tax Relief in those years so I want to make sure I get the calc right once and for all!

Thanks 

Marcon

HMRC_Complication said:

Hi all,

First post on the MSE Forum . 

Can someone help me understand the calculation for Additional Rate Tax Relief? 

I calculated it as 25% of Total Employee Contribution in my 23-24 Self Assessment however I've been told by a friend that this should in fact have been 25% of Total Gross Contribution (Employee + Employer + Basic Relief). I have tried to find out the correct calculation method online and found conflicting information so turning to the forum for some clarity. 

In addition to potentially revising my 23-24 SA, I will be submitting an Overpayment Relief claim for 21-22 and 22-23 as I did not claim Additional Rate Tax Relief in those years so I want to make sure I get the calc right once and for all!

Thanks 

Sometimes friends are best ignored...

Employer pension contributions (including those made as a result of salary sacrifice) are always paid gross, so there is no tax relief available to claim. They aren't a benefit in kind so you haven't been taxed on them.

There are loads of explanations on the internet and I thought this was one of the best: https://getpenfold.com/news/claim-higher-rate-pension-tax-relief

TheSpectator

Hopefully your friend isn't making such claims, baffles me where people get their info from.

As above your first port of call should be to establish the method under which your contributions are treated.