Pension and salary sacrifice

HappyHarry

Somebody said:

In my view there is no scope to pay contributions into a SIPP.

Maximum pension contributions = lower of 100% relevant earnings or £60k annual allowance (use of carry forwards only possible if relevant earnings allow).

In OP's case:

Gross pension contributions in the name of OP = £30k made by Employer

Relevant earnings = £30k (£50k - £20k) ignoring BIK etc, so no additional contributions possible

Your view is wrong.

Go back and read the second post in the thread.

Dazed_and_C0nfused

Somebody said:

In my view there is no scope to pay contributions into a SIPP.

Maximum pension contributions = lower of 100% relevant earnings or £60k annual allowance (use of carry forwards only possible if relevant earnings allow).

In OP's case:

Gross pension contributions in the name of OP = £30k made by Employer

Relevant earnings = £30k (£50k - £20k) ignoring BIK etc, so no additional contributions possible

You are conflating the annual allowance, where employer contributions are relevant.

And the tax relief limit, where they aren't relevant.

af1963

Maximum *personal* gross contributions  ( excluding employer contribs)= 100% of relevant earnings.  Salary sacrifice payments are employer contributions so OP has paid zero.

Maximum *total* gross contribution ( including employer contribs) = £60k (plus any available unused allowance from past 3 years, if a member of a pension during those 3 years). £30k of employer contribs have been made, so there is another £30k gross available. (£24k net.)