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If you're earning over £50k please read this 
You might be missing out on pension relief!
It's really easy to fix (I get pensions are boring and complicated, but stick with me!)
Thread (explained simply)
You might be missing out on pension relief!
It's really easy to fix (I get pensions are boring and complicated, but stick with me!)
Thread (explained simply)
Lots of employers use pension schemes that operate under a "relief at source" arrangement.
That's great, if you pay tax at 20%.
It means the pension provider claims your 20% tax relief automatically and you don't need to lift a finger
BUT!...
That's great, if you pay tax at 20%.
It means the pension provider claims your 20% tax relief automatically and you don't need to lift a finger
BUT!...
It's a problem if you pay 40% tax (i.e. earn £50k +).
You're entitled to 40% tax relief, but your pension provider is only claiming 20%!
Here's how to check if that's the case, then how to fix it...
You're entitled to 40% tax relief, but your pension provider is only claiming 20%!
Here's how to check if that's the case, then how to fix it...
1. Ask your employer what pension scheme they're using, and whether it's a "net pay arrangement" or "relief at source" scheme.
Send them this if they're not sure what that means: https://www.nowpensions.com/help-centre/gateway/employee/general-information-gateway-help-centre/whats-the-difference-between-net-pay-and-relief-at-source
Send them this if they're not sure what that means: https://www.nowpensions.com/help-centre/gateway/employee/general-information-gateway-help-centre/whats-the-difference-between-net-pay-and-relief-at-source
2. If they tell you they use "relief at source" and you earn over £50k, it's time to get your extra tax relief.
If you complete a tax return, just add your pension contributions to the right box and job done.
If you don't complete a tax return then move to step 3.
If you complete a tax return, just add your pension contributions to the right box and job done.
If you don't complete a tax return then move to step 3.
3. Contact HMRC following the instructions here: https://www.gov.uk/tax-on-your-private-pension/pension-tax-relief
Here are the contact details: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/income-tax-enquiries-for-individuals-pensioners-and-employees
Here are the contact details: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/income-tax-enquiries-for-individuals-pensioners-and-employees
4. You want to say something like:
"Hey my good friends at HMRC, I am a higher rate tax payer but my employers pension scheme only claims 20% tax relief for me. Please can you advise me how I can claim the extra 20% relief?"
"Hey my good friends at HMRC, I am a higher rate tax payer but my employers pension scheme only claims 20% tax relief for me. Please can you advise me how I can claim the extra 20% relief?"
They'll probably change your tax code and issue you a refund of overpaid tax in previous years. You might need to send them some info to prove your contributions, though.
You can claim up to 4 years prior.
It's a faff, yes, but it's worth doing!
You can claim up to 4 years prior.
It's a faff, yes, but it's worth doing!
Disclaimer tweet of course - pensions are heavily regulated and complicated so please seek your own professional advice if you're not sure what you're doing 
(As much as I wish my tweet threads count as professional advice, they don't!)
(As much as I wish my tweet threads count as professional advice, they don't!)
