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How do you get tax relief when paying into a Sipp?

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Comments

  • jamesd
    jamesd Posts: 26,103 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    You can claim immediately, even if you haven't made the pension contributions yet. Just tell HMRC the gross going into the pension and ask them to update your tax code. Gross going into the pension means after the basic rate tax relief is added, with no allowance by you for higher rate relief. This will get you the tax relief during the tax year instead of having to wait.
  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
    jamesd wrote: »
    You can claim immediately, even if you haven't made the pension contributions yet. Just tell HMRC the gross going into the pension and ask them to update your tax code. Gross going into the pension means after the basic rate tax relief is added, with no allowance by you for higher rate relief. This will get you the tax relief during the tax year instead of having to wait.

    That sounds a good idea.

    Just to get this right, I tell HMRC what Estimate I will be paying into my SIPP right now. They will adjust my tax code accordingly, and then if my estimate is wrong, I can reconcile it all in my tax return for 2016/17.
  • jamesd
    jamesd Posts: 26,103 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    That's right.
  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
    Cheers jamesd you explained that so succinctly nice one fj
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