SIPP & Pension guidance - IM Private Clients

SIPP & Pension guidance - IM Private Clients

Author
Discussion

Ron-ski

372 posts

57 months

Tuesday 27th April 2021
quotequote all
PM3 said:
Here is where I started and claimed back tax . https://www.gov.uk/claim-tax-refund
......( held up a little because HMRC were missing some information of 83p paid as interest on some account I thought was dead . Yeh really!
You might want to find that account, it's probably got a small fortune sat in it to earn 83p these days wink

leef44

4,359 posts

152 months

Tuesday 27th April 2021
quotequote all
Mr Pointy said:
PM3 said:
Here is where I started and claimed back tax . https://www.gov.uk/claim-tax-refund
Thanks for that, I was wondering how to go about it.

Over the years I seem to have ended up with three Government Gateway IDs though...
I thought that method only allowed you to claim tax refund based on employer pension fund contributions. Maybe it has changed but when I tried to do this last year, the first thing it asks is employment details. It doesn't have a way of entering private pension contribution outside of employment.

Mr Pointy

11,145 posts

158 months

Tuesday 27th April 2021
quotequote all
leef44 said:
Mr Pointy said:
PM3 said:
Here is where I started and claimed back tax . https://www.gov.uk/claim-tax-refund
Thanks for that, I was wondering how to go about it.

Over the years I seem to have ended up with three Government Gateway IDs though...
I thought that method only allowed you to claim tax refund based on employer pension fund contributions. Maybe it has changed but when I tried to do this last year, the first thing it asks is employment details. It doesn't have a way of entering private pension contribution outside of employment.
Reclaiming from a taxed pension withdrawal does seem to be missing from the list of reasons for claiming:


ian74947

1 posts

198 months

Wednesday 12th May 2021
quotequote all
I’m planning on setting up the first pension at the age of 35 through a limited company as the director. I’ve not had much advice so far but knowledge of others is key. I am looking to find some guidance in the best route and meanwhile best tax efficient way. I will also be taking on PAYE employee in the next 6 months who may also need/opt for pension assuming they will want full time work.
Any recommendations and help to get kick started on this route would be greatly appreciated

Jockman

17,912 posts

159 months

Wednesday 12th May 2021
quotequote all
ian74947 said:
I’m planning on setting up the first pension at the age of 35 through a limited company as the director. I’ve not had much advice so far but knowledge of others is key. I am looking to find some guidance in the best route and meanwhile best tax efficient way. I will also be taking on PAYE employee in the next 6 months who may also need/opt for pension assuming they will want full time work.
Any recommendations and help to get kick started on this route would be greatly appreciated
Ian this is your first post. Nearly 14 years in the making…….well done !!

Just ask your Accountant or the guys at IM to set up a SIPP for you and then start dripping in your company contributions. Relief at Corp tax rates and no link to earnings. Normal allowances apply.

Do the same for your Employee if you like.

Stevil

10,653 posts

228 months

Thursday 13th May 2021
quotequote all
Just on hold with HMRC at the moment about getting my tax relief sorted, contributed all sorts of odd amounts into my IM SIPP over the last year due to various reasons but I've settled on an amount going forward and will amend that to include any future pay rises. I'm hoping I can register so that I can claim back relief on the contributions for last year but presumably they are going to want to see proof of those, is there a nice easy way to show all the contributions made in the last year from the client dashboard or a PDF I can generate to send off as proof? I can see all the EEDD contributions on the dashboard but they're spread over 12 or so pages.

Edit: Scrap that, bar the long time spent on hold, it was actually pretty easy to sort out over the phone, new tax code added and a tax rebate for the contributions made last year. Here's hoping come the annual pay review I can repeat the process and increase the contributions then watch the money roll in. I'll leave it up to you guys at IM to ensure the growth rate continues to exceed expectations...

Edited by Stevil on Thursday 13th May 12:43

markiii

3,560 posts

193 months

Thursday 13th May 2021
quotequote all
never been asked for proof on pension contributions, whether they have a means of checking or just take it on trust though I have no idea

PorkInsider

5,877 posts

140 months

Wednesday 19th May 2021
quotequote all
I've just been asked by HMRC to provide proof of the contributions I've made for my additional tax rebate claim.

I did point out that they surely already know how much I've contributed as they've provided the basic rate rebate back straight into my pension.

It fell on deaf ears though - I guess it's just how it works - so looks like I need to get copies of the proofs and post them in.

Edited by PorkInsider on Wednesday 19th May 11:24

LeoSayer

7,299 posts

243 months

Sunday 23rd May 2021
quotequote all
I'm trying to calculate the maximum my wife can pay into her SIPP and still get tax relief.

My wife is a member of the LGPS (career average) pension and is currently contributing around 6.5% from her gross pay (not via salary sacrifice). This will result in an annual pension and small lump sum.

She earns less than Annual Allowance figure figure of £40,000 per year.

Is it the lesser of:
- 93.5% of annual earnings ie. 100% less the 6.5% LGPS contribution
- £40,000 less the difference in accrued in lump sum compared to last year plus 16x the increase in the accrued annual pension compared to last year

Thanks

Intelligent Money

Original Poster:

503 posts

62 months

Sunday 23rd May 2021
quotequote all
LeoSayer said:
I'm trying to calculate the maximum my wife can pay into her SIPP and still get tax relief.

My wife is a member of the LGPS (career average) pension and is currently contributing around 6.5% from her gross pay (not via salary sacrifice). This will result in an annual pension and small lump sum.

She earns less than Annual Allowance figure figure of £40,000 per year.

Is it the lesser of:
- 93.5% of annual earnings ie. 100% less the 6.5% LGPS contribution
- £40,000 less the difference in accrued in lump sum compared to last year plus 16x the increase in the accrued annual pension compared to last year

Thanks
Hi LeoSayer

It is a combination of the two!

The contributions amount for the LGPS is calculated by taking the increase in pension pension benefit for the tax year in question x16
plus any increase in lump sum benefit for that tax year.


You then subtract this figure from her earnings for this year and that its the max contribution for this tax year.
You can then "carry forward" unused contributions from the previous 3 years.
For each of those years you calculate the LGPS contribution in the same way, using the increase in pension and lump sum for the appropriate year but you then subtract this from £40k irrespective of her earnings in those years.

Hope this is clear enough but feel free to drop me a message at nik.burrows@intelligentmoney.com if you need any additional info or help with the calculation.

Cheers

Nik

LeoSayer

7,299 posts

243 months

Tuesday 25th May 2021
quotequote all
Nik, that leaves less headroom than I expected.

I'll do the calc and may well come back to you with that.

Many thanks

Llandudno

2,457 posts

181 months

Tuesday 25th May 2021
quotequote all
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?

Mr Pointy

11,145 posts

158 months

Wednesday 26th May 2021
quotequote all
Llandudno said:
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?
Maybe HMRC when you submit your tax return?

CoopsIM

311 posts

44 months

Wednesday 26th May 2021
quotequote all
Llandudno said:
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?
Good afternoon

I am doing some research and I will come back to you. I just want to make sure I've checked a few things first.

Kindest regards

Coops

CoopsIM

311 posts

44 months

Wednesday 26th May 2021
quotequote all
CoopsIM said:
Llandudno said:
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?
Good afternoon

I am doing some research and I will come back to you. I just want to make sure I've checked a few things first.

Kindest regards

Coops
Each provider will check that maximums are not exceeded with them and most include a statement that the individual understands the limits that apply to them as individuals, so the client is ultimately responsible for making sure that they do not exceeded contribution limits.

HMRC will also be aware of the tax reclaimed or contributions offset as business expenses so can always run that as a final catch point

If you need anything further, please let me know

Kindest regards

Coops

Llandudno

2,457 posts

181 months

Wednesday 26th May 2021
quotequote all
Mr Pointy said:
Llandudno said:
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?
Maybe HMRC when you submit your tax return?
I don't need to submit one.

Llandudno

2,457 posts

181 months

Wednesday 26th May 2021
quotequote all
CoopsIM said:
CoopsIM said:
Llandudno said:
I contribute to my SIPP via salary sacrifice through an umbrella payroll (I'm a contractor).

I plan to contribute £90k this tax year, £40k allowance this year, plus £30k and £20k carry over.

Given I can have multiple SIPP providers, none of which know my overall situatuon, who checks I'm sticking to the allowances?
Good afternoon

I am doing some research and I will come back to you. I just want to make sure I've checked a few things first.

Kindest regards

Coops
Each provider will check that maximums are not exceeded with them and most include a statement that the individual understands the limits that apply to them as individuals, so the client is ultimately responsible for making sure that they do not exceeded contribution limits.

HMRC will also be aware of the tax reclaimed or contributions offset as business expenses so can always run that as a final catch point

If you need anything further, please let me know

Kindest regards

Coops
Thanks Coops. Interesting that there is no systemic check by HMRC. With salary sacrifice there is no tax reclaimed for them to check of course.
I'm not planning on contributing more than I'm entitled, so looks like I'll have to keep my own papertrail in case anybody checks.

CoopsIM

311 posts

44 months

Wednesday 26th May 2021
quotequote all
Llandudno said:
Thanks Coops. Interesting that there is no systemic check by HMRC. With salary sacrifice there is no tax reclaimed for them to check of course.
I'm not planning on contributing more than I'm entitled, so looks like I'll have to keep my own papertrail in case anybody checks.
No problem at all. If you need anymore information, drop me an email at steve.cooper@intelligentmentmoney.com and I'll be more than happy to look into it for you.

Kindest regards

Coops

Tony Angelino

1,970 posts

112 months

Wednesday 9th June 2021
quotequote all
Potential daft question here please lads........

I am doing a bit of budgeting for the future, specifically retirement, and I am trying to work out what my state pension is likely to be. Now I have logged onto Government Gateway and my forecast is £179.60 per week (assuming I contribute for another 2 years), I understand this is the maximum. Now my question is what about the Additional State Pension or SERPS and if I am likely to get it. I can't seem to find any way of checking for sure other than waiting and seeing.

A bit of background:

Employed full time for the last 25 years, no gaps.
Only had a private pension for the last 8 years.
Never knowingly opted out.

Can anybody offer and help please?
Thanks

Jasey_

4,823 posts

177 months

Wednesday 9th June 2021
quotequote all
I was opted out and it states that on my pension forecast - I guess if you weren't opted out then it doesn't show.

I guess you could call them up - here's some reading if you can't be arsed spending 2 days on the phone wink

https://www.gov.uk/government/publications/state-p...