Tax return question

[trousers]

Hi,

 

Any tax experts out there?!

 

I'm filling in my 2009/10 form online as we speak and am stuck at the following entry:

 

Payments to registered pension schemes where basic rate tax relief will be claimed by your pension provider (called 'relief at source'). Enter the payments and basic rate tax:£

 

I do pay into a private pension scheme but directly via my PAYE rather than out of my bank account.

 

So, on my payslip I have 3 entries in the 'deductions' column, namely: Tax, N.I. and Employee Pension Contributions.

 

(note: my employer also contributes to my pension separately from the company bank account, so this is definately "employee contribution" I'm talking about here)

 

So, (I think) my question is: are my monthy deductions before or after tax and does this affect what I put in the above box?

 

Yes, I know I could give the tax office a call but having spent 3 days dealing with insurers etc over a collapsed drain I don't think I could stomach spending anymore time on the phone this week! And I can't find my pension statement at the moment, which I guess would help.

 

Cheers for any help :-)

[rooney]

The amount you pay via your Salary already has the tax allowable made to you. i.e. it is taken off your Salary and you only pay tax on the net amount of your salary, after the pension payment is deducted. The amount you put on the tax return is the actually amount you pay monthly X 12 and the amount of basic tax relief is 20% of this resultant figure.

[trousers]

The amount you pay via your Salary already has the tax allowable made to you. i.e. it is taken off your Salary and you only pay tax on the net amount of your salary, after the pension payment is deducted. The amount you put on the tax return is the actually amount you pay monthly X 12 and the amount of basic tax relief is 20% of this resultant figure.

 

Cheers - Some of my salary is taxed at 40% - does that make a difference to the final figure I put in the box? thanks again

[trousers]

The amount you pay via your Salary already has the tax allowable made to you. i.e. it is taken off your Salary and you only pay tax on the net amount of your salary, after the pension payment is deducted. The amount you put on the tax return is the actually amount you pay monthly X 12 and the amount of basic tax relief is 20% of this resultant figure.

 

Sorry, just re-read what you said and have another question....if the amount that comes out my PAYE 'deductions' at source is "untaxed" money then why would I be claiming tax back (through my Tax Return) if I haven't paid any tax on it in the first place? In other words, HMRC can't give me back tax that I never paid, can they??

[St_Tel49]

Sorry, just re-read what you said and have another question....if the amount that comes out my PAYE 'deductions' at source is "untaxed" money then why would I be claiming tax back (through my Tax Return) if I haven't paid any tax on it in the first place? In other words, HMRC can't give me back tax that I never paid, can they??

I am no expert Trousers but any contributions you made would have been subject to tax relief at the basic level. You are entitled to claim back the additional 15% hence your claim - but I could stand corrected on this by an accountant. Actually, I use Taxcalc software to submit my returns online and for the £25 you pay each year it doesn't half make the job much easier. It includes help on issues like yours (and cheaper than an accountant). Furthermore you can copy the previous year's claim into this year and just adjust the numbers. (I don't work for them by the way )

[Whitey Grandad]

The money is paid to the pension company net of 20% basic tax, so if you want to pay in £1000, you only have to give them £800 and the pension company gets the other £200 from HMRC. If you pay %40 tax then you claim the other %20 back through your tax return.

[View From The Top]

I decided to adopt the tory supporters approach to tax this year and an accountant friend of mine ensured a very, very, very small return to HMRC.

 

I'm sure all the tories will support this act of pure capitalism.

[Whitey Grandad]

I decided to adopt the tory supporters approach to tax this year and an accountant friend of mine ensured a very, very, very small return to HMRC.

 

I'm sure all the tories will support this act of pure capitalism.

It is the duty of every taxpayer to pay the minimum that they can. If you feel the need to help your fellow citizens, then there are plenty of charities and other voluntary organizations.

[rooney]

Sorry, just re-read what you said and have another question....if the amount that comes out my PAYE 'deductions' at source is "untaxed" money then why would I be claiming tax back (through my Tax Return) if I haven't paid any tax on it in the first place? In other words, HMRC can't give me back tax that I never paid, can they??

 

You are not paying tax on your gross salary only the net, after the premiums have been deducted from salary.

 

It is because only basic rate tax is initially allowed and if you are a higher rate tax payer, you will, be entitled to an extra 20%, hence the reason for entering this on your Tax return

[ericofarabia]

Remember all this info only applies if you live outside the Skatesmuff postal area.

Why not move there and be exempt?