Tax return and SIPP issue
Tax return and SIPP issue
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Discussion

-Cappo-

Original Poster:

20,212 posts

219 months

Yesterday (13:01)
quotequote all
I have a SIPP which pays me monthly and reports my drawdown and the tax paid via an annual P60.

Went to complete my tax return today, and HMRC have "helpfully" pre-populated the return; however, they have entered my SIPP provider as my "Employer", and the amount received as income from that employment. It wasn't like this in previous years; I usually enter my pension income under the "Pension" section and declare 0 employments.

If I try to alter it (ie state that I had 0 employments in that period) I get an error stating that I can't d-e-l-e-t-e* items from that section. I then deleted the entire tax return and started again but the same thing happened.

Had an online chat with HMRC and they said just to continue with the income in the Employment section. I then asked whether that would attract/skew NI contributions, and his advice was to add a comment at the end of the return pointing this out - which I'm not comfortable with or confident that they'll adjust accordingly. He went on to say it may be a technical glitch at their end but didn't offer any other solution.

Anyone got any clues how to get around this?

* stupid spelling of "delete" in order to get around the far more stupid SQL coding on this site rolleyes


Simpo Two

89,407 posts

281 months

Yesterday (14:02)
quotequote all
I've been self-employed most of my life, so when I started taking an income from my SIPP I was horrified to get a P60. 'This is for PAYE people!' I thought; 'I'm not on PAYE, I'm not an employee!'

But that's how it works. The SIPP sends you money like you're a member of staff.

Panamax

6,653 posts

50 months

Yesterday (14:19)
quotequote all
Yes, SIPP income is effectively PAYE. You receive it net after however much tax gets deducted by your code - and if they don't have a code for you the provider will deduct an "emergency" tax rate.

There's an article on the subject here,
https://www.ii.co.uk/pensions/tax/emergency-tax-pe...

-Cappo-

Original Poster:

20,212 posts

219 months

Yesterday (18:05)
quotequote all
Oh yes, I get the P60 thing, I get one every year from the pension provider. My point was, HMRC have unilaterally decided to allocate that amount as “Employment”, and if they think I’ve earned that sum from employment, then they’re going to automatically calculate an NI bill as well, surely?

I’ve been drawing a pension for 5 years and had a P60/completed a tax return for the previous 4, but this automatic allocation of income is a new one. I’ve checked old tax returns and the income is where it should be: under Pensions.

If I can’t amend it then I can’t see how I can complete the tax return, as I’d essentially be providing incorrect information.


MadCaptainJack

1,217 posts

56 months

Yesterday (19:33)
quotequote all
Christ, HMRC really are a bunch of lazy, incompetent clowns...

Given that they're obviously not fking interested in doing their job properly, I would suggest making a Data Protection Complaint. See https://ico.org.uk/for-the-public/i-m-worried-abou...

Sheepshanks

37,655 posts

135 months

Yesterday (19:57)
quotequote all
Simpo Two said:
I've been self-employed most of my life, so when I started taking an income from my SIPP I was horrified to get a P60. 'This is for PAYE people!' I thought; 'I'm not on PAYE, I'm not an employee!'

But that's how it works. The SIPP sends you money like you're a member of staff.
I want to know why we can't access pension sacrifice cars!

clockworks

6,834 posts

161 months

Yesterday (20:07)
quotequote all
I'm getting three pensions - state, and two DB from previous employments. I'm also self-employed.

My SA always gets pre-filled with state pension and one DB pension properly classified.
The other DB pension is always classified as "employment".

I've tried deleting and re-adding, putting on a note saying it's a pension, and phoning HMRC.
Makes no difference, comes back as "employment" again the following year.


Thing is, both DB pensions are administered by the same company. No idea why one shows as pension, the other as employment income.

Panamax

6,653 posts

50 months

Yesterday (20:40)
quotequote all
MadCaptainJack said:
Given that they're obviously not fking interested in doing their job properly, I would suggest making a Data Protection Complaint.
I'd save your energies for something more worthwhile. It all adjusts out at the end of the year.

HMRC's big computer in the sky just loves trying to allocate PAYE codes but gets its knickers hopelessly twisted when people have multiple sources of income. If you're lucky, they'll but some at basic rate, some at flat 40% and then try to juggle their numbers (i.e. allocate a specific code) to whichever one is big enough to take up the slack.

craig1912

4,053 posts

128 months

Yesterday (20:46)
quotequote all
I have an employee number with my SIPP provider and monthly payslips. The NI rate is X.

Sheepshanks

37,655 posts

135 months

Yesterday (21:39)
quotequote all
I find the monthly payslips from Standard Life by post (for both wife and I) bizarre - I haven't had those for years, usually just getting them in months 1 and 12. Tried to stop them but no joy.

I also suddenly started getting taxed at 40% on a small private pension from this April. Seems HMRC had decided my old employer, whom I left in June 24, was going to pay me £60K. The SA portal wouldn't let me remove it from my account. Sent them a note through the portal and they took it off it (but didn't communicate back to me at all).