Higher Rate Tax Relief SIPP

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/82046387#Comment_82046387

The basic rate band is only £37,700, so in this case it would be extended to £97,700.

QrizB

SIPP payments £60k

Are you saying you contributd £60k net? So £75k gross?

sometime_soon

Sorry I have confused by not stating so I will try again!!

Self Employment income £90k

SIPP payments £60k ( gross including the automatic 20%)

Entered £60k into self assessment as obviously it is entered gross . But was going by the literature that says you have to claim the extra 20% as HR tax payer if paying into a SIPP as only the 20% is automatically added.
I was seeing if anyone else has done this and the calculations at the end just show the increased basic rate and was this correct and nothing else needs to be added??

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/82046404#Comment_82046404

There is no "extra 20%" to claim.

All you do is enter the correct amount in the pension contribution box on the return and your basic rate band will be increased to reflect the gross contribution.

If you are interested in the tax saving you have benefitted from (over and above the 20% basic rate relief) why not just check your return calculation before and after the pension contributions are added?

sometime_soon

https://forums.moneysavingexpert.com/discussion/comment/82046416#Comment_82046416

Thanks. Yes I had added and removed the pension contributions as I kept checking myself!! It all seemed correct but I was just not sure if it really was as simple as the calculation shown or I was missing a “tick box” or something else that I had to add in as all the literature was you must claim separately on self assessment.

DRS1

https://forums.moneysavingexpert.com/discussion/comment/82046317#Comment_82046317

If you want to see how much higher rate tax you have saved with the pension contribution you could edit your tax return so it does the calculation leaving out the pension contribution and then does it with the pension contribution included. Obviously don't submit the return. The difference is what tax you have saved.

Crudely you have lifted your higher rate band from c50k to c110k. But as you earn 90k you only save the higher rate tax on c40k. So a saving of say £8k.

sometime_soon

Sorry all if my question sounded stupid! It should have been laid out better to explain simply “did I have to add anything else other than just the box for pension contributions on self assessment “.
I understood it increased the basic rate but I was concerned I had missed a part where I had to “claim separately “ going by the HMRC literature as that being the case, the calculations shown were all off !
Put simply, it just seemed way too straightforward a process on self assessment ! I was expecting a more complicated route.

DRS1

https://forums.moneysavingexpert.com/discussion/comment/82046442#Comment_82046442

No You don't need to do anything more. I am not sure if they will ask you for evidence of the contribution - I imagine so for that size of contribution.

sometime_soon

https://forums.moneysavingexpert.com/discussion/comment/82046463#Comment_82046463

Thanks. It’s not that I am suspicious of HMRC and things seeming too easy to be correct so much so, that I need to check and double check because the help guide was overwhelming complicated and contradictory and I was somehow expecting the same on the calculations !!