Ideas Portal
When a pension scheme with the Pension Rule: Relief at source is selected an optional box of Subtract basic rate tax appears. Rather than being an optional tick box could this be auto ticked for a RAS scheme as a RAS pension scheme gives tax relief on the employee contributions. Being an optional tick box that only appears when a RAS Pension Rule is selected, not ticking the box would mean the employee would not receive tax relief and would pay a full 5% for example.
On the Staffology webinar last week Alex Hay’s screen showed a pension scheme was set up as RAS and the box wasn’t ticked, on the payslip he then showed the pensionable earnings were £3669, the ee contribution was 5% and was showing as £183.45It should have been £146.76 with basic rate tax relief.
Staffology advised "I can confirm that a Relief at Source pension scheme does not always gain tax relief, as this is optional. This is the reason why the tick box is available. This is standard for a number of different payroll providers."
Staffology was not able to give an example of a RAS scheme where tax relief is not applied. If an individual employee didn't have an NI number is wouldn't be applied, but that would be on the individual person rather than the scheme set up.
