| [Para 6, Sch 29][s188(2)][s190] |
Where a member has paid
relievable pension contributions in a tax year of
more than the maximum amount that can receive tax relief the
legislation allows the amount of contributions that cannot receive
tax relief (the excess) to be repaid to the member.
RPSM05101130 outlines what the
legislation means by relievable pension contributions. This covers
any contribution paid by (or on behalf of) the member before the
age of 75 (other than employer contributions, or any amount paid as
rebates or minimum payments by HMRC relating to contracting-out).
The relievable pension contributions made in a tax year are
tax relievable (whether through the net pay arrangement or through
relief at source) provided they do not exceed the
individual’s relevant UK earnings (or, if lower and using the
relief at source provisions, £3,600).
RPSM05101120 explains what the
annual limit on tax relief on member contributions is.
Where relievable pension contributions are paid that exceed
the relievable amount, the excess can be refunded. 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 of a refund of excess contributions lump sum must
be made before the end of the period of six years following the end
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 the only authorised member lump sum that can be paid
after the member has reached age 75
RPSM09104820 gives details of the
amount that can be paid and an example of a payment of a refund of
excess contributions lump sum.
| Glossary ( RPSM20000000) |
