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Posted Mon, 11 Mar 2024 09:43:56 GMT by D629597
Is savings interest classed as income and can it be paid into a SIPP and get basic rate tax relief?
Posted Fri, 15 Mar 2024 11:57:42 GMT by HMRC Admin 19 Response
Hi,

Interest is taxed as income, but it does not count towards working out your earnings threshold for tax relief on pension payments. You can pay the interest into your pension scheme. You can see guidance here:

Check if you have unused annual allowances on your pension savings

Thank you.
Posted Tue, 19 Mar 2024 13:22:58 GMT by D629597
Just to clarify. It doesn't count towards my total earning for this tax year? So as long as I don't go over my pension contribution allowance I can add it to my SIPP and gain tax relief? But it can only be interest earned in the current tax year. Thanks
Posted Thu, 21 Mar 2024 08:33:55 GMT by D629597
Do I subtract the savings personal allowance and add 80% of the remainder? or just add 80% of the total gross interest? Thanks
Posted Wed, 17 Apr 2024 12:49:26 GMT by HMRC Admin 20 Response
Hi D629597,
How the payment made to a SIPP is made up is up to you. you cannot take into accounts the personal savings allowance or tax already deducted on the interest when working out what you want to pay.
Thank you.

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