| [s197(4 – 5)] |
The period over which tax relief will be spread depends on the size of the relevant excess contribution. Tax relief on the excess contribution will be spread as follows
| Amount of relevant excess contributions | Period of spreading of tax relief |
| £500,000 or more but less than £1,000,000. | 2 years
The relevant excess contribution is to be treated as being split equally (1/2) over the current chargeable period and the next chargeable period. |
| £1,000,000 or more but less than £2,000,000. | 3 years
The relevant excess contribution is to be treated as being split equally (1/3) over the current chargeable period and the next two chargeable periods. |
| £2,000,000 or more. | 4 years
The relevant excess contribution is to be treated as being split equally (1/4) over the current chargeable period and the next three chargeable periods. |
See
RPSM05102110 for an example.
Once a spread of tax relief has been determined it will not
be changed unless the employer ceases to carry on business –
see
RPSM05102120.
| Glossary ( RPSM20000000) |
