For those of you that are in the advantageous situation where you can plan how much taxable income to take, or have a second smaller income, it may interest you to learn, that in many cases you can also make a single pension contribution, linked to this smaller income. The great thing is that this can be done at any time, to take advantage of the available tax relief.
This is a situation where the government will help you, so the more you save into your pension, the more help you’ll get from the government.
For example, if you pay basic rate tax:
|You save||Tax relief added as a boost to your contribution||Total contribution added to your pension plan|
If you pay a higher or additional rate of income tax, you could benefit from additional tax relief, which you can claim from HM Revenue & Customs. However tax relief can change and depends on your individual circumstances and where you live in the UK.
Any single contributions you make are added to your pension and invested to help them grow, helping you save more for your retirement. The but is while its great that the government is giving taxpayers a break, so we save more into our pensions, your savings and investments could grow but market fluctuations also mean their value can go down. This means you could get back less than you put into your plan.
Give your pension savings a boost.
If you’d like more information about how you can benefit from tax relief, any limits that apply, and how you can give your pension savings a boost by making a single contribution, please get in touch with us so we can talk through your particular circumstances and objectives.
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