Q: Can you give me your opinion on the non-disclosure in my tax return of a self-invested pension plan (SIPP) payment to HM Revenue & Customs (HMRC)?
Every March I make substantial payments into my SIPP and in past years, these have been declared in my tax return.
This year, with the new rules, which involve accruals and multipliers, I 'guesstimated' that a £5,000 SIPP contribution may still attract higher-rate tax relief, so I made that investment. I am aware that, in the fullness of time, HMRC may not allow any or all of it and I may have to repay some tax relief.
My accountant omitted the payment from my tax return, insisting that if he did include it, HMRC would automatically give me higher-rate tax relief on it and I may not be entitled to it. I feel vulnerable not disclosing the £5,000 contribution. What do you think?
A: If you have made pension contributions these should be disclosed in your tax return on page four. If you do actually know some of these contributions exceed the special annual allowance - which means you will not be entitled to higher-rate tax relief - you need to complete the additional information on page four (Ai4) in box 9 and state the amount of pension over the special annual allowance. A special annual allowance charge will be calculated at 20 per cent for the excess amount.