lb320

Hello, Thanks for those links HMRC Admin 32. I am happy from the links that in the scenario above, total pension contributions would be below £60k for the year, and that I would be able to take off the 'grossed up' £15,000 for the SIPP pension contribution which would leave adjusted net income at £100k. The bit I am still unclear about is the tax rebates that would then be available on a self assessment. With taxable income at £100k, I believe I would be entitled to a tax rebate of £9,000 for the tax overpaid throughout the year via PAYE (£36,432 - £27,432). The bit I am unclear about is whether there is then a further rebate for being on the higher tax rate (40%) but only getting the automatic basic rate 20%/£3,000 SIPP bonus from the pension provider. By my calculations, I would get another £3,000 rebate to account for being on the higher rate so that of the SIPP contribution I would make after rebate is £9k out of the £15k final amount. In this scenario (keeping it basic so not including anything else ie. child benefits or gift aid) would the rebate be £9k, £12k or a different figure entirely and why? Thanks

Hello, I am looking to get clarity on the tax treatment of paying into a SIPP when earnings are in the threshold for the personal allowance reduction (£100k-125k). Say for example I earned £115k during the tax year, paying tax via PAYE of £36,432 (£5,070 @ 0%; £37,700 @ 20%; £72,230 @ 40%) during the tax year but then wanted to pay into a SIPP to reduce my taxable income at the end of the tax year: - Pay £12,000 into a SIPP and automatically receive the £3,000 (20%) government bonus to get total personal pension contribution of £15,000 for the tax year - Taxable income reduced to £100,000 on my self assessment (£115,000 of salary minus £15,000 of pension contribution) - Tax therefore should have been £27,432 (£12,570 @ 0%; £37,700 @ 20%; £49,730 @ 40%) for the tax year - Entitled to a tax rebate of £9,000 for the tax overpaid via PAYE during the year (£36,432 - £37,432) - Entitled to an additional tax rebate of £3,000 to account for being on the higher rate but only getting the automatic 20%/£3,000 SIPP bonus - Final position: total tax rebate is £12,000 and total amount in the SIPP in £15,000