Company Pension 40% tax payer

[Mollyeyes]

Hello

If you are a 40% tax payer and in a company pension do you tax relief at 40% or do you need to apply for the additional tax relief through HMRC yourself. The pension provider hasn’t mentioned anything

Thanks

It depends how the tax relief is applied.

1. Your pension contribution is taken gross earnings and sent to the pension provider. Tax is then calculated on the remaining taxable earnings. In this case no need to do anything as you've have top-sloce tax relief at source.

1. Pension contributions are taken, net of 20% relief, from post-tax income. They are sent to the pension provider who reclaims the 20% tax relief from HMRC. In this case you have to claim the higher rate relief yourself on a tax return.

You should be able to work out which scenario from how much your tax is.

Thank you @Chasingsquirrels

Your pay slips should show you when the pension contributions are applied.

I think it’s a salary sacrifice scheme if that helps

If it's salary sacrifice you get relief via payroll.

@Aquicknamechange2019 thank you. Do you mean if I’m 40% tax payer the whole 40% tax relief I’d given by payroll?

It means your taxable income is reduced by the amount of your contributions so you pay less tax via PAYE than you would have otherwise.

Thank you @Aquicknamechange2019