HMRC Estimated Earnings Incorrect for Pension Pay Out

Tessajb

eskbanker said:

Tessajb said:

TheSpectator said:

What actually is your tax code?

Hi,  K125 is my code for 2025/2026 period. Just looked at prvious years and its not showing.

What income stream is this showing against?  Tax codes are applied per income stream, so if that's against the one that no longer exists, then it's academic and won't actually be used, so do you have any actual 2025/26 projected PAYE income visible within your account?

Hi eskbanker,   So, what i am very worried about is that i need to access my Standard Life Pension soon, and i was concerned that HMRC would use this Tax code and estimated earnings and put me in the super tax bracket of 45%... am i being over worried??

Tessajb

eskbanker said:

Tessajb said:

TheSpectator said:

What actually is your tax code?

Hi,  K125 is my code for 2025/2026 period. Just looked at prvious years and its not showing.

What income stream is this showing against?  Tax codes are applied per income stream, so if that's against the one that no longer exists, then it's academic and won't actually be used, so do you have any actual 2025/26 projected PAYE income visible within your account?

Apologies:   It is showing against Pension Protection Fund 2025/2026 period - Tax Free amount showing :-£1261
Estimated Tax:£47,132.... They got these figures from their error of stating monthly allowance not annual full allowance when they entered this last April 2024.

molerat

If SL is a pension you have never accessed before the first draw will be at 1275LX.  That will kick HMRC into sorting the codes.  My SIL still has a code allocated against a job she finished in 2021 and as she has no other PAYE income they keep issuing a code against it and estimating the tax to be deducted.  It is one of the confusing quirks of the system.

eskbanker

Tessajb said:

eskbanker said:

Tessajb said:

TheSpectator said:

What actually is your tax code?

Hi,  K125 is my code for 2025/2026 period. Just looked at prvious years and its not showing.

What income stream is this showing against?  Tax codes are applied per income stream, so if that's against the one that no longer exists, then it's academic and won't actually be used, so do you have any actual 2025/26 projected PAYE income visible within your account?

Hi eskbanker,   So, what i am very worried about is that i need to access my Standard Life Pension soon, and i was concerned that HMRC would use this Tax code and estimated earnings and put me in the super tax bracket of 45%... am i being over worried??

Do you have the option of making a small token withdrawal from the Standard Life one, so that heavy taxation wouldn't be a significant issue, but should then afford the opportunity to adjust expected income levels accordingly?

Tessajb

eskbanker said:

Tessajb said:

eskbanker said:

Tessajb said:

TheSpectator said:

What actually is your tax code?

Hi,  K125 is my code for 2025/2026 period. Just looked at prvious years and its not showing.

What income stream is this showing against?  Tax codes are applied per income stream, so if that's against the one that no longer exists, then it's academic and won't actually be used, so do you have any actual 2025/26 projected PAYE income visible within your account?

Hi eskbanker,   So, what i am very worried about is that i need to access my Standard Life Pension soon, and i was concerned that HMRC would use this Tax code and estimated earnings and put me in the super tax bracket of 45%... am i being over worried??

Do you have the option of making a small token withdrawal from the Standard Life one, so that heavy taxation wouldn't be a significant issue, but should then afford the opportunity to adjust expected income levels accordingly?

I will enquire with Standard Life tomorrow, as if I can this would be a way to get HMRC to adjust tax code and annual expected income.  Thank you so much feel a bit more confident in my approaches to this, I shall update tomorrow if successful. Thank you so much

Dazed_and_C0nfused

Tessajb said:

eskbanker said:

Tessajb said:

eskbanker said:

Tessajb said:

TheSpectator said:

What actually is your tax code?

Hi,  K125 is my code for 2025/2026 period. Just looked at prvious years and its not showing.

What income stream is this showing against?  Tax codes are applied per income stream, so if that's against the one that no longer exists, then it's academic and won't actually be used, so do you have any actual 2025/26 projected PAYE income visible within your account?

Hi eskbanker,   So, what i am very worried about is that i need to access my Standard Life Pension soon, and i was concerned that HMRC would use this Tax code and estimated earnings and put me in the super tax bracket of 45%... am i being over worried??

Do you have the option of making a small token withdrawal from the Standard Life one, so that heavy taxation wouldn't be a significant issue, but should then afford the opportunity to adjust expected income levels accordingly?

I will enquire with Standard Life tomorrow, as if I can this would be a way to get HMRC to adjust tax code and annual expected income.  Thank you so much feel a bit more confident in my approaches to this, I shall update tomorrow if successful. Thank you so much

I suspect you are wasting your time asking Standard Life about any of this.

As at @molerat has said Standard Life will use the emergency tax code (1257L) on  the first payment you take from that pension.

Once Standard Life have reported that payment to HMRC then HMRC will review your tax code.

As you have already said the previous pension is already shown as having ended (presumably in 2024-25) then that should be ignored when any new tax code is calculated for the current tax year.