Pension Contribution and Tax Relief

Dear HMRC Community, This is my understanding, and I would like make sure it is correct before making one-off contribution to my pension My pension is relief-at-source (20%) Income is 120,000 so the personal allowance is 12570 - (120000 - 100000) / 2 = 2570 So my tax rates are: first 2570: 0% next 37700 (i.e. 50270 - 12570): 20% the rest 79730: 40% making total tax = 39,432 Personal allowance is 60,000 per tax year, and I would like to top up enough so as to hit this cap (for simplicity, I ignore the employer contribution, which I understand will consume the 60,000 allowance) So I pay from my own pocket (and some via PAYE in reality) 48,000 I automatically get 12,000 into my pension as tax relief (20%) So now it is the tricky part I would like to seek clarification because the gross contribution is 60,000 and so my tax-free bucket is increased by the amount and hence it becomes first 62570: 0% next 37700 (i.e. 50270 - 12570): 20% the rest 19730: 40% making total tax = 15,432 Tax relief in total = 39432 - 15432 = 24,000 (which is 40% of 60,000 gross contribution) With 12,000 given into the pension pot, the remaining 12,000 can be claimed by writing to HMRC (the additional 20% as people usually mention). All seem to tied up. Question 1: Is my understanding and the calculation above correct? Question 2: Can I get the remaining 12,000 as cash back to my account (because I deposit into my pension pot *in advance* before HMRC processing the additional tax relief)? Question 2.1: I understand HMRC may put this 12,000 in a way to reduce the tax burden in the following tax year but I just think it is extremely confusing to mix it with another year (plus I may lose my job and no income and hence I won't pay tax anyway). If this is the default option, how could I opt for other options? Question 2.2: Or perhaps, the remaining 12,000 will be given into my pension? But then I max out the 60,000 allowance for current year. I heard from some of the staff at my pension CS department that HMRC could adjust the *next year* allowance to 60,000 + 12,000 = 72,000 so I will not be "above annual allowance" for current tax year. Is it correct? Many thanks!

Hi bwearryyu,
Tax relief on pension contributions is applied in the tax year the payment is made.
Please refer to Tax on your private pension contributions for additional guidance.
Thank you.

Thank you. But the page doesn’t really show any example to illustrate the mechanism of tax relief calculation. Anyway, my question is: if I contribute 48000 and get auto relief at 20% I.e. 12000 to max out the annual allowance of 60000, then when I claim the additional tax rate relief, could I get it in cash?

Hi bwearryyu,
Please refer to the guidance at Tax on your private pension contributions.
If you are claiming higher rate income tax relief over £10000, you will need to contact HMRC and claim through completing a Self Assessment Tax Return.
Repayments are not made in cash, but instead by cheque or to your bank account.
Thank you.