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Where Taxpayers and Advisers Meet

Self Assessment question regarding Child Benefit & the £50k limit

MarkSL
Posts:1
Joined:Sat Mar 31, 2018 8:09 pm
Self Assessment question regarding Child Benefit & the £50k limit

Postby MarkSL » Sat Mar 31, 2018 11:11 pm

Hi,

I have been doing self assessment since the Child Benefit change for earners over £50k came in, as I have been earning between £54 and £57 for the past few years and having three kids. I do not have a great understanding of all matters tax as I'd always been PAYE and I find the self assessment a bit of a chore..

I recently read the following article which states:

"For child benefit purposes your taxable pay is taken into account. If you earned £52,000 and you did salary sacrifice, paying £2,000 as a pension contribution then your salary goes down to £50,000, so you don’t lose your child benefit..
Heaton said that pension contributions, whether they are made through salary sacrifice into a workplace scheme or directly into a personal pension scheme, all count towards lowering taxable income".

http://citywire.co.uk/money/earning-over-50k-you-dont-need-to-miss-out-on-child-benefit/a682507

However in my Self Assessment form i have always answered No to the question "Did you make contributions towards a personal pension or retirement annuity? This does not include payments you make to your employer's pension scheme, which are deducted from your pay" - as from the wording it suggests not to include payments to employers pension scheme.

I spoke to a Self Assessment adviser at HMRC and they thought that I should be able to go back and edit previous years SA's and write to HMRC for years further in the past to have my pension contributions considered and therefore to receive a refund for my lost child benefit. However the guy sounded pretty woolly about it and didn't instill me with much confidence.

My employer was in the salary sacrifice scheme. Should I be able to do this?

My earnings for 16/17 were £56,400 with £2500 in pension contributions.

Any advice greatly appreciated!

Mark

someone
Posts:692
Joined:Mon Feb 13, 2017 10:09 am

Re: Self Assessment question regarding Child Benefit & the £50k limit

Postby someone » Mon Apr 02, 2018 7:11 pm

It's probable (although not certain) that your pension contributions have already been deducted from your gross pay:

My earnings for 16/17 were £56,400 with £2500 in pension contributions.

becomes:

My earnings would have been 58900 except that I agreed my employer would pay me 2500 less in return for them paying 2500 into my pension.


You have to ask you employer whether the payments were made using the "net pay" scheme (which IIRC means they reduced your gross pay) or the "relief at source" scheme (in which case they came out of your net pay and you should include them on your tax return)

I often get these two schemes confused - so if I've named them backwards then don't be surprised.


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