Q: I’m in receipt of an NHS pension, contribute to a private pension and think I’ve become a higher rate taxpayer. I’ve never done a tax return before – how do I claim the tax relief please?
A: It is important to note that your two pension schemes work in different ways.
The NHS pension scheme uses ‘Net Pay’, whereby contributions are taken before income tax is calculated. This means the person automatically receives full tax relief, including higher-rate relief if they qualify.
A private personal pension uses ‘Relief at Source’ which means contributions are made from after-tax income. The provider adds basic-rate relief (20%) automatically. If the person is a higher-rate taxpayer, they may be entitled to additional relief, which must be claimed by completing a self-assessment tax return.
Please get in touch if you would like us to assist you further with this.
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