RPSM05101540 - Technical Pages: Contributions and tax relief: Member contributions: Refunds of contributions: Refund of excess contributions lump sum

A refund of excess contributions lump sum

Where a member has paid pension contributions in a tax year of more than the maximum amount that can receive tax relief (see RPSM05101120), the amount of contributions that cannot receive tax relief (the excess) may be repaid to the member.

The legislation refers to this as the ‘excess contributions condition’. If this condition is met, the excess contributions can be paid to the member as a refund of excess contributions lump sum.

The payment must be made before the end of the period of six years beginning with the last day of the tax year in which the ‘excess contributions condition’ was met, i.e. the tax year in which the ‘excess’ contribution was paid.

This is therefore the only ‘authorised’ member lump sum that can be paid after the member has reached age 75.

RPSM05101550 gives details of the amount that can be paid and an example of a payment of a refund of excess contributions lump sum.