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Posted Fri, 15 Dec 2023 14:09:09 GMT by
To quote the example listed below: "Emma paid £700 into her pension scheme. She puts £875 in this box (£700 divided by 80 and multiplied by 100), which is her net payment plus the tax relief of £175 (£875 at 20%). If you pay tax at a rate above the basic rate, 20%, you are entitled to further tax relief. It will be automatically calculated and the credit included in your tax calculation." This is not clear to me on what exactly I need to enter as a higher rate tax payer. If I pay £700 into my pension, should I put £1166 in this box given 40% tax was paid on the money that goes into my pension? On this link, it explains a bit more but still not clear: "If you pay tax at a rate above 20% you should still fill in box 1 with the amount you paid in plus the basic rate (20%) tax relief. We’ll work out the extra tax relief due to you over the basic rate claimed by your pension provider." What is the basic rate (20%) tax relief I need to add to the £700 paid to my pension? Is it 700 * 0.2 or is it (700/0.8)*0.2? Why can't we have a proper example in the self-assessment forms for higher tax rate relief?
Posted Thu, 21 Dec 2023 08:33:50 GMT by HMRC Admin 25
Hi bqiao,
You would divide the £700 (or whatever you paid into your pension scheme) by 80, then multiply that figure by 100.
This will give you your net payment, plus basic rate tax relief.
On submitting your return, we will automatically calculate the additional, Higher Rate relief due.
Thank you. 

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