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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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I have a private pension ,as I am now retired will my tax relief

Customer Question

I have a private pension ,as I am now retired will my tax relief stop automatically or do I write or telephone to cancel
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. I am in some difficulties with your question. You ask whether your tax relief will stop on your retirement to which I ask 'What tax relief?' Are you in receipt of your State Pension (SP)? Is your private pension vested and paying out or are you still contributing? I need some more data before I can properly address your position.
Customer: replied 1 year ago.
I do not contribute to my private pension as I am now retired and am receiving my private pension also my state pension
Expert:  bigduckontax replied 1 year ago.
Thank you; here is the normal procedure. Your tax code will be applied against your private pension. Many private pension providers do not like operating PAYE on the pensions they pay out. I personally have dragged two household name insurance companies kicking and screaming into compliance. Your SP is taxable, but paid gross. Thus your tax code, normally 1060. will be reduced to collect the tax due on your SP. So, you should send your P45 which you should have received from your last employer to your private pension payer so that PAYE can carry on as normal, but you must check that the tax codes issued by HMRC post the start of your SP is correct so that you can hopefully be tax neutral at the year end. That is the theory, much monitoring and checking is needed each tax year end and in this case in the middle too. HMRC have got my initial coding at the start of each tax year wrong these last 20 years! Your pension contributions up to retirement, if any, should have been discounted to give you the tax relief available on pensions up to 40K in the 15/16 tax year. Continuous checking and monitoring of your tax codes is essential to keep everyone on the straight and narrow and make you tax neutral at the year end.
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3101
Experience: FCCA FCMA CGMA ACIS
bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 1 year ago.
Thank you for your support.
Customer: replied 1 year ago.
I am happy enough with the answer, all I needed was a bit of info on my personal pension, I don't want to owe money if possible to I.r
Expert:  bigduckontax replied 1 year ago.
Delighted to have been of assistance.

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