Pension Contributions Refunded In The Next Tax Year

crashedandcool

Hello. I started a job in Feb 2024 and opted out the company pension, but not before I had deductions from my salary in Feb and March. They were done as sacrifices so it reduced my income before tax. The contributions were refunded in April in the new tax year and counted as extra income there. Now I realise that the contributions will now be liable for income tax as I was under the allowance in 23/24, but will be over 24/25

Is there a way for this to be fixed or do you just have to accept it?

Marcon

crashedandcool said:

Hello. I started a job in Feb 2024 and opted out the company pension, but not before I had deductions from my salary in Feb and March. They were done as sacrifices so it reduced my income before tax. The contributions were refunded in April in the new tax year and counted as extra income there. Now I realise that the contributions will now be liable for income tax as I was under the allowance in 23/24, but will be over 24/25

Is there a way for this to be fixed or do you just have to accept it?

There's no requirement for an employer to 'refund' contributions made by salary sacrifice, as these are technically employer contributions, so even a refund which has been taxed is better than your strict legal entitlement (no 'refund' at all).

crashedandcool

Marcon said:

crashedandcool said:

Hello. I started a job in Feb 2024 and opted out the company pension, but not before I had deductions from my salary in Feb and March. They were done as sacrifices so it reduced my income before tax. The contributions were refunded in April in the new tax year and counted as extra income there. Now I realise that the contributions will now be liable for income tax as I was under the allowance in 23/24, but will be over 24/25

Is there a way for this to be fixed or do you just have to accept it?

There's no requirement for an employer to 'refund' contributions made by salary sacrifice, as these are technically employer contributions, so even a refund which has been taxed is better than your strict legal entitlement (no 'refund' at all).

I'm just going by what the information I was given by the company and Aviva at the time that if I opted out within 30 days I'd get the payments refunded. Which is what happened.