HMRC has launched a new system for claiming tax relief on private pension contributions. The Labour government's tax authority says you can use the service to claim tax relief on your personal pension and workplace pension scheme or change an existing claim.
Eligibility for Tax Relief
To be eligible to claim tax relief, you must be:
- An intermediate rate taxpayer or a higher rate taxpayer who pays into a personal or workplace pension.
- A basic rate taxpayer who pays into a workplace pension but whose employer does not or will no longer claim tax relief.
- A basic rate taxpayer who pays a lump sum into a personal or workplace pension that is not under a net pay scheme.
A net pay scheme is where the employer takes your pension contributions from your pay before any tax is deducted.
Information Required
To claim tax relief on your personal and workplace pension payments, you will need to know:
- Your National Insurance number
- The type of pension
- The name of the pension provider
- The net amount of pension contributions for each tax year you are claiming for
- Your payroll number or reference number
You will need to upload or send proof for each tax year you claim for. This can be a letter or statement from your pension provider, or a payslip from your employer. This proof must include:
- Your full name
- Details of the pension contributions paid and the tax year they relate to
- Evidence that you received 20% tax relief automatically from your employer — if you are claiming for a workplace pension
- Evidence that you did not receive any relief from your employer — if you are a basic rate taxpayer
How to Claim
You will need to sign in to claim online. If you do not already have sign in details, you will be able to create them. You will need to use the same sign in details that you used to make your initial claim. You can make changes to the information you submitted. You should do this as soon as possible by signing into the service and selecting the relevant option to make changes.
Public Reaction
Responding to the change, one taxpayer said: "I still don't understand why this isn't automated. For RAS pensions you automatically get the 20% relief for lower rate tax, so why is it on the individual to claim back for the higher rate? The government know you have a pension, and they know you're a higher rate tax payer."
A second asked on Reddit: "Stupid question time, do you have to do this for your employer pension? I'm assuming not, it's salary sacrifice so it comes out before tax? The ability to add employer pension confused me on the form..."
