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Posted Tue, 14 May 2024 16:03:20 GMT by PeteSouthgate
I'm due to complete self assessment for the first time that will include income from a rental property and PAYE. Background: Basic rate tax payer, employed, employer has a standard workplace pension but I have opted to do salary sacrifice in the tax year (I have my annual statement from Aviva which shows the figures). When completing my self assessment, I'm looking to confirm what numbers need to be included in the below section. There are two sections, I would like to know what is the correct section, for reference I have made three seperate payments amounting to £12,500: "Payments to registered pension schemes (Also known as PPR) where basic rate tax relief will be claimed by your pension provider (called Relief at source). Enter the payments and basic rate tax OR Total of any 'one-off' payments to registered pension schemes included in the 'Payments to registered pension schemes where basic rate tax relief will be claimed by your pension provider' box: Is the correct answer: #1. £12,500.00 * 0.2 = £15,000 And if so, which of those two options should I put the information in? It's my first time using a SIPP, bearing when I made a £12,500 contribution the pension provider will only claim the 20% tax relief in 6-8 weeks and post it to my account. Should I put I have contributed £12,500 to my SIPP on my tax return or should I be putting £12,500 * 0.2 = £15,000. Sorry for all my questions but I am a very apprehensive about including a wrong figure on my return.
Posted Fri, 17 May 2024 06:07:06 GMT by HMRC Admin 25 Response
Hi PeteSouthgate,
If you have paid into a works pension scheme before your employer deducts tax from your income, then you will have received tax relief at source and no further tax relief is due.
If you paid into the pension scheme after tax is deducted from your income, your pension provider will claim basic rate tax relief from HMRC and add it into your pension pot.
You then can then claim claim higher rate tax relief on pension payments, provided you pay higher rate tax.
You enter the gross figure in the tax return ((£12500/80)*100).
This will extend the basic rate band, so that more of your income is taxed at 20% and less at 40%, thus giving additional tax relief in the tax calculation.
Thank you. 

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