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Hello, I`m really sorry but I am confused between what you tell me and what the response to Clarky55 under `relevance of Annual Allowance and MPAA to non-residents contributing into UK Pension Schemes`where HMRC Admin 19 said: ……. Tax relief is only available if your are an active member of a registered pension scheme and are a relevant UK individual, in the tax year in which the contribution is paid. If you do not meet this criteria then there is no pension payment relief available. In my case, I am not entitled to any tax relief on relievable pension contributions because I am not a `relevant UK individual`as I have been living in Europe for 10 years but I am an`active member`of a UK registered Pension scheme, as is the case with Clarky55. I have a salary from the UK but it is taxed at 0% because it is subject to a DTAA and is entitled to be taxed in Europe only, not the UK https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm044100#relievable states that `Relevant UK earnings are to be treated as not being chargeable to income tax if by virtue of section 2(1) Taxation (International and Other Provisions) Act 2010 (double taxation arrangements), they are not taxable in the United Kingdom. To the extent that they are not chargeable in this way, they will also not count towards the annual limit for relief explained in Annual limits ……`. My proposal would be to increase the amount of contributions my employer makes which would exceed the Annual Allowance & MPAA as a salary sacrifice.My employers contribution is not deemed to be a relievable contribution per Sections 188(3)(b) and 201 Finance Act 2004 but does it become part of the Annual Allowance under s233 ? Money Purchase Annual Allowance (MPAA) would not apply, as the contributions are not eligible for relief. You can see guidance here: Abolition of Liftime Allowance and increases to Pension Tax Limits The essence of this statement on the tax return for Clarky55 indicated there was no need to complete SA101 questions 10 & 11 but looking at the form, the additional information notes, there is no detailed information on how this is calculated re: non a `relevant UK individual` etc. Is the difference in the response to me and the response to Clarky55 because my employer will make the pension contribution whilst Clarky55 made a pension contribution into his employers fund (there was no reference about if its his current employer)? This seems to be pedantic I realise but I need to understand:the logic how: - My employer makes salary sacrifice contributions to it`s pension fund for me which is in excess of the annual allowance & money purchase annual allowance, - I do not have a relievable pension contribution as I will not have paid anything - If the payment was taken as salary, I would be taxed in the UK 0% under the DTAA so there is no benefit to me of sacrificing it in the UK pension plan or as salary to me. - But despite this, your indication is that I will have to be taxed on the excess over the Annual Allowance and Money Purchase Allowance, essentially double taxing me in Europe and the UK because I am intending to use the existing employer fund. It doesn`t make sense to me?

Hello, I have been going through MPAA questions and I note HMRC Admin 19 gave Clarky55 an answer to his/her problem which was very similar, almost exactly like my question. Can you tell me the difference between your response to him and not being able to answer mine above? Thank you.

Also, when you get your HMRC self-assessment bill, HMRC may have added circa. £16k freelance income to your future bills and make the future tax on circa. £16k payable in 2 installments in Jan, 2025 & July, 2025 as `payment on account`. This is HMRC`s attempt to get the tax payable for income when it is earned as opposed to 6-12 months later when the tax returns are lodged and HMRC issue an assessment. If you get the HMRC `payment on account`on your current tax liability and you don`t think you will earn as much as stated or not earn any freelance work at all, you need to tell HMRC that you will have no/reduced income either online or via a SA303 form by post.

I have excluded NI from this calculation.. Tax from you salary should be: £12,570 tax free + £37,700 * 20% = £7,540 +(£58,772 - £50,271) x 40% = £3,400.40 = Total £10,940.80 but the tax paid under PAYE appears to be £9.793.20 so you will still need to pay HMRC £1,147.60 on your salary. (Probably you had a pay rise during the year or a bonus and your employer had only deducted circa. 20% tax???) Tax from your Freelance work: Taxable £15,910 * 40% = £6,364 LESS SIPP deduction is the actual contribution £12,728 / 80% - £12,728 = £3,182 Total tax payable £3,182 but you have (£15,910 freelance work - £12,728 SIPP contribution by you) = £3,182 cash left over from your freelance work to pay this tax. Tax Payable: Total tax payable for the year £1,147.60 tax Salary + £3,182 tax Freelance work = £4,329.60 (but you still have £3,182 cash still have from freelance work). So this is as per your analysis result £4,486 but including NI. So….. Freelance work: cash £15,910 - SIPP contribution £12,728 = £3,182 cash available which you will pay to HMRC for tax on Freelance work (above) = £nil cash left from Freelance work SIPP contribution £12,728 + SIPP Govt Contribution £3,182 = Total SIPP £15,910 which is the same as your Freelance remuneration But ..... you still have to find the amount of tax which was not deducted from your salary as PAYE and the small amount of NI on freelance work.

Thank you. Is there an e-mail address or phone no. for the self assessment team?

Sorry, the amounts were incorrect as I changed only part of it from £420 to £300 covering NI & tax thereon. I had done one. I will do this just with NI of £300 and thus you have a SIPP investment of £14,700- The text should have been: - As you contribute NI through your employer and are at 40% tax rate, I imagine all you will have to pay is 2% class 4 on the £15k as it will exceed the 6%/2% threshold = NI £300 - The contribution to a SIPP should be £11,760 ((£15k -£300) x 80%). The SIPP provider will arrange Government Contribution of 20% which will amount to £2,940. This will be a total SIPP investment of £14,700. - In your self assessment forms you will claim a 20% rebate for the contribution = $11,760/80% - £11,760 = £2,940. So this results in: Self employed income £15,000 - 40% tax (£6,000) - NI Class 4 (£300) + 20% SIPP contrib £2,940 = £11,640 net The difference between the £11,760 SIPP contribution and the £11,640 net tax effect is the 40% tax on what is the £300 NI class 4 payment. So... the net cost to you of the £14,700 SIPP contribution from £15k self employment will be (£300 NI contribution + 40% tax on the NI contribution £120) = £420 cost £15,000 self employed income, $14,700 SIPP investment post govt contribution, £300 NI contribution but you will have to obtain an additional £120 from your employment income to cover the 40% tax on NI contribution.

Hi, I`m just an observer and you must check this with a financial adviser / SIPP provider but my thought are: - As you contribute NI through your employer and are at 40% tax rate, I imagine all you will have to pay is 2% class 4 on the £15k as it will exceed the 6%/2% threshold = NI £300 - The contribution to a SIPP should be £11,760 ((£15k -£420) x 80%). The SIPP provider will arrange Government Contribution of 20% which will amount to £2,940. This will be a total SIPP investment of £14,700. - In your self assessment forms you will claim a 20% rebate for the contribution = $11,760/.8 - £11,760 = £2,940. So this results in: Self employed income £15,000 - 40% tax (£6,000) - NI Class 4 (£300) + 20% SIPP contrib £2,940 = £11,640 net The difference between the £11,760 SIPP contribution and the £11,640 net tax effect is the 40% tax on what is the £300 NI class 4 payment. So... the net cost to you of the £14,700 SIPP contribution from £15k self employment will be (£300 NI contribution + 40% tax on the NI contribution £120) = £420 cost £15,000 self employed income, $14,700 SIPP investment post govt contribution, £300 NI contribution but you will have to obtain an additional £120 from your employment income to cover the 40% tax on NI contribution.

Hello, I`ve been a European tax resident for 10 years. I want to withdraw some cash as a lump sum from my pension(s) to help buy a property to live in. My SIPP provider sent me brochures saying any contributions would then be limited to £10,000. I am paid a disability insurance payout via a salary through my UK employer. I was intending to increase the amount paid into pension as a salary-sacrifice, the amount would exceed the £40,000 annual allowance. I don`t intend this to be a pension recycling, I am a tax rate of 0% in the UK so it makes no difference to HMRC if I take the salary as cash or the whole amount goes as a pension contribution. I have a rental property in the UK and that amount I pay tax on according the the UK marginal rate. Because I have a tax rate of 0% on my salary, will I have extra UK tax on the excess over £40k I salary-sacrifice into the employee pension fund? either now or when I do decide to take a pension? (that will be taxed in the European state per the DTA) I don`t contribute any pension to the SIPP but if I did, I imagine this would be limited to £10,000 SIPP contribution rather than being taxed at my marginal rate? Thank you!