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Tax benefits for SIPP - additional tax rate band

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  • Qyburn
    Qyburn Posts: 3,913 Forumite
    Fifth Anniversary 1,000 Posts Name Dropper
    af1963 said:

    I'm not convinced it's as straightforward as that ... the different ways in which the tax relief is delivered may confuse things, but you can make a case for saying the final amount is 125.   You put 80 in the pension and got 20 added, so you now have 100 in the pension. And you received 25 via a refund of tax paid on other income.
    In that case you're considering the investment to be £80, and the tax refund that you receive is part of the return, making the return still £45.
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