Claiming higher rate tax relief on SIPP

seans_elysees

Hi, 

I'm looking for advice on how best to claim my higher rate tax relief on my SIPP. 

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

Albermarle

Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen?

Yes they should amend ( increase ) your tax code for 26/27, and it should happen automatically at some point.

seans_elysees

Albermarle said:

Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen?

Yes they should amend ( increase ) your tax code for 26/27, and it should happen automatically at some point.

Thanks.  I’m actually intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

Dazed_and_C0nfused

seans_elysees said:

Albermarle said:

Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen?

Yes they should amend ( increase ) your tax code for 26/27, and it should happen automatically at some point.

Thanks.  I’m actually intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

The current way this works is that evidence needs to be provided so not sure there is anything you do to circumvent that.

Give you would be getting any higher rate relief drip fed each pay day anyway presumably it's not really too much of an issue.

I'm not sure what you mean by this comment though?  You will only ever get basic rate relief added to your SIPP.

I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately

Marcon

seans_elysees said:

Hi, 

I'm looking for advice on how best to claim my higher rate tax relief on my SIPP. 

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

Your provider only claims basic rate tax relief. Higher rate relief isn't added to your SIPP.

seans_elysees

Dazed_and_C0nfused said:

seans_elysees said:

Albermarle said:

Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen?

Yes they should amend ( increase ) your tax code for 26/27, and it should happen automatically at some point.

Thanks.  I’m actually intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

The current way this works is that evidence needs to be provided so not sure there is anything you do to circumvent that.

Give you would be getting any higher rate relief drip fed each pay day anyway presumably it's not really too much of an issue.

I'm not sure what you mean by this comment though?  You will only ever get basic rate relief added to your SIPP.

I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately

Sorry, I’ve not explained very well.  

I want to contribute a total of £10k (£8k + bonus) to my SIPP spread over the course of the year.  

If my tax code reflects and I’m getting the appropriate relief each pay cycle then I’m effectively not getting taxed at 40%. That’s what I meant by the additional relief going straight into investment. 

If that doesn’t happen then I’m instead being taxed at 40% - meaning I have less money in my pocket until I can reclaim. 

Marcon said:

seans_elysees said:

Hi, 

I'm looking for advice on how best to claim my higher rate tax relief on my SIPP. 

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

Your provider only claims basic rate tax relief. Higher rate relief isn't added to your SIPP.

Thanks for comments. 

See above. I made a poor attempt at explaining what I’d meant. 

I know the SIPP will only ever at basic relief. 

What I’m trying to confirm is how I get the higher relief up front so I’m not having to be in a position of making my SIPP contribution from net pay that I’ve been taxed 42% - as that means I’m operating on less money until I can reclaim 12 months down the line. 

hugheskevi

seans_elysees said:

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

You can evidence (a) Your taxable income year-to-date (b) Pension contributions year-to-date (c) Supply estimated full year taxable income (probably projecting salary forward) and (d) Supply estimated full year taxable income (probably based on last month's contribution).

My experience is that HMRC are happy to change tax code based on that. However, they take their sweet time about changing it, so best to do it as early as possible so that a new code is used before the end of the tax year

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

For small contributions, you can just call HMRC and they will amend tax code over the phone immediately with no evidence of income or contributions required. It is only if gross contributions are above £10,000 that evidence needs to be supplied via the online tool.

I’m intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

If you call them as soon as your 26/27 code is generated, you can get the planned £10,000 pension contribution applied to your Tax Code from the start of the year. That could mean you actually get some of the relief in advance, if you monthly contributions at the start of the year are less than £10000 / 12 = £833.33

Many is the time I coded in large contributions at the start of the tax year (before the £10,000 limit was applied) in anticipation of the contribution being made, only for my plans to change and not actually make any relief-at-souce contribution at all, then I coded them out just before the end of the year.

seans_elysees

hugheskevi said:

seans_elysees said:

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

You can evidence (a) Your taxable income year-to-date (b) Pension contributions year-to-date (c) Supply estimated full year taxable income (probably projecting salary forward) and (d) Supply estimated full year taxable income (probably based on last month's contribution).

My experience is that HMRC are happy to change tax code based on that. However, they take their sweet time about changing it, so best to do it as early as possible so that a new code is used before the end of the tax year

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

For small contributions, you can just call HMRC and they will amend tax code over the phone immediately with no evidence of income or contributions required. It is only if gross contributions are above £10,000 that evidence needs to be supplied via the online tool.

I’m intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

If you call them as soon as your 26/27 code is generated, you can get the planned £10,000 pension contribution applied to your Tax Code from the start of the year. That could mean you actually get some of the relief in advance, if you monthly contributions at the start of the year are less than £10000 / 12 = £833.33

Many is the time I coded in large contributions at the start of the tax year (before the £10,000 limit was applied) in anticipation of the contribution being made, only for my plans to change and not actually make any relief-at-souce contribution at all, then I coded them out just before the end of the year.

Thank you - most helpful! 👍 

So for 25/26 where I’ve currently made net contribution of £1k, and 2 monthly payments of £125 still to some - do you recommend just calling them to sort that since it is low numbers according to what you say?  

And then I can call them after my first pay cycle in 26/27 once I have tax code for the year for them to update based on my projected £8k SIPP contribution over the year. 

Dazed_and_C0nfused

seans_elysees said:

hugheskevi said:

seans_elysees said:

HMRC said to do it online but the form asks for the net contribution for 2025/26. I have a couple of questions about whether this is the correct/suitable path. 

1) My current 2025/26 contribution that can be evidenced is Apr-Jan. I'm still going to have payments in Feb/March which I would be projecting. I'm not sure if that is permitted, and/or whether I would need to wait until the end of the tax year to claim this. 

You can evidence (a) Your taxable income year-to-date (b) Pension contributions year-to-date (c) Supply estimated full year taxable income (probably projecting salary forward) and (d) Supply estimated full year taxable income (probably based on last month's contribution).

My experience is that HMRC are happy to change tax code based on that. However, they take their sweet time about changing it, so best to do it as early as possible so that a new code is used before the end of the tax year

2) My more significant ambition is to get this sorted for the forthcoming financial year(s). I'm intending to contribute approx. £10k p/a to my SIPP so don't want to be having to retrospectively claim this back each April rather than having my money invested in the SIPP immediately. Will HMRC amend my tax code so I'm getting the tax relief up front and what do I need to do to make that happen? 

For small contributions, you can just call HMRC and they will amend tax code over the phone immediately with no evidence of income or contributions required. It is only if gross contributions are above £10,000 that evidence needs to be supplied via the online tool.

I’m intending to increase my SIPP contributions quite considerably mid-year in 26/27, so is there a way to get ahead of that rather than just having them apply the increased allowance based on what I’d paid in the previous year? 

If you call them as soon as your 26/27 code is generated, you can get the planned £10,000 pension contribution applied to your Tax Code from the start of the year. That could mean you actually get some of the relief in advance, if you monthly contributions at the start of the year are less than £10000 / 12 = £833.33

Many is the time I coded in large contributions at the start of the tax year (before the £10,000 limit was applied) in anticipation of the contribution being made, only for my plans to change and not actually make any relief-at-souce contribution at all, then I coded them out just before the end of the year.

Thank you - most helpful! 👍 

So for 25/26 where I’ve currently made net contribution of £1k, and 2 monthly payments of £125 still to some - do you recommend just calling them to sort that since it is low numbers according to what you say?  

And then I can call them after my first pay cycle in 26/27 once I have tax code for the year for them to update based on my projected £8k SIPP contribution over the year. 

Have you actually read the current rules?

https://www.gov.uk/guidance/claim-tax-relief-on-your-private-pension-payments

hugheskevi

seans_elysees said:

So for 25/26 where I’ve currently made net contribution of £1k, and 2 monthly payments of £125 still to some - do you recommend just calling them to sort that since it is low numbers according to what you say?  

And then I can call them after my first pay cycle in 26/27 once I have tax code for the year for them to update based on my projected £8k SIPP contribution over the year. 

You might be able to do it through the HMRC check your tax code service, but if you do not already have an allowance for personal pension in your tax code I think you usually have to call to add it.

No need to wait until after your first pay cycle for 26/27, you can amend your 26/27 code as soon as it is issued. But it is possible that code will already include pension allowance anyway, based on 25/26.