The InvestEngine Personal Pension operates under relief at source. This means that for every pension contribution we receive our pension provider claims tax relief from HM Revenue and Customs (HMRC) at the basic 20% rate. This process takes between six and eleven weeks but once the funds are received we add this directly to your InvestEngine Personal Pension.
For example, you pay us a contribution of £80 and we claim relief of £20 from HMRC (this being 20% of the gross contribution of £100).
If you are resident in England, Northern Ireland or Wales you can claim additional tax relief for money you put into relief at source pensions of:
- 20% up to the amount of any income you have paid 40% tax on
- 25% up to the amount of any income you have paid 45% tax on
If you are resident in Scotland you can claim additional tax relief for money you put into a private pension of:
- 1% up to the amount of any income you have paid 21% tax on
- 22% up to the amount of any income you have paid 42% tax on
- 25% up to the amount of any income you have paid 45% tax on
- 28% up to the amount of any income you have paid 48% tax on
If you already submit a Self Assessment tax return then you should claim the additional tax relief through this return. If you are using this process then there is no immediate need to submit any form of evidence. HMRC will receive reports from pension providers which will allow them to verify your claim.
If you do not submit a Self Assessment tax return, then great news! We’ve partnered with Pie, the all in one tax app to help you reclaim what you’re owed. Using their award winning app, you can sign-in, create your profile, and submit the claim for your additional rate of pension tax relief, all without contacting HMRC yourself - Pie will do this for you!
When making the application with HMRC Pie will act as your agent and submit the claim on your behalf, and just like InvestEngine, they’re free for DIY customers (but don’t worry, you can get some help for a small fee if you’d prefer some support).
Pie can also support you with all of your self assessment needs, so head over to InvestEngine, navigate to ‘Get additional tax relief’ in your Pension’s options menu, and let Pie help you get back what you’re owed. Plus, you can use our calculator here to see the impact adding this additional tax relief has on your retirement.
You can still do this yourself if you wish, so if you’re doing this without Pie’s help, you should register directly with HMRC. You will need to provide evidence of the contributions paid so to do this log into your InvestEngine account, select Reports then Create Reports and SIPP contribution statement.
Remember, the tax treatment of your investments is subject to personal circumstances which may change in future.