At Max Pro Accountants we know that millions of pounds of pension tax relief go unclaimed each year. So if you’re a higher or additional rate taxpayer, you could be missing out on a significant sum.
Here’s How it Works…..
Tax Relief Basics
When you contribute to a pension, you’re essentially getting free money from the government.
Types of Pensions
Net Pay: Tax relief is automatically applied as you pay less tax on your income after your pension contribution.
Relief at Source: Your pension provider claims 20% tax relief from the government, but you may need to claim the rest yourself.
Higher Rate Taxpayers: If you pay higher or additional rates of tax, you’re entitled to more tax relief than basic rate taxpayers.
Claiming Your Relief…..
Higher/Additional Rate
Taxpayers:
If you contribute to a relief at source pension, you must claim the extra tax relief you’re entitled to.
Claiming Methods:
Self-Assessment:
The easiest way to claim is through your self-assessment tax return.
Contact Us: You can also claim by contacting us directly and we’ll provide all the help and assistance you will need.
Benefits of Claiming…..
Significant Savings:
Claiming the extra tax relief can significantly reduce your pension contribution costs. For example, a higher-rate taxpayer could effectively contribute £6,000 for every £10,000 invested.
Backdated Claims:
You can typically claim tax relief for up to four previous tax years.
Important Considerations…..
Annual Allowance Limits:
There are limits on how much you can contribute to your pension while still receiving tax relief.
Carry Forward Unused Allowance:
If you haven’t used your full allowance in previous years, you may be able to carry it forward.
Consult with a Us…..
If you’re a higher earner and unsure about your tax relief entitlements, it’s crucial to get the best advice. At Max Pro Accountants we can help you understand your options and ensure you’re maximising your retirement savings. So Contact Us HERE today.