A state pension tax question

[Wullie10]

As most state pensions are below the threshold and don't pay tax but we have a work pension so obviously will be taxed. How do they work it all out. ? Will we be taxed halfway through the financial year or sent a bill at the end of that year ? It's all very confusing.

[gfte]

Tax codes, state pension doesn't tax at source so private / company pensions apply as per whatever tax code is assigned.

[Wullie10]

So the pension company will give a tax code and the state pension won't be taxed as such. ? It'll still remain the same weekly amount. So technically your work pension could possibly decrease depending on the tax situation ? Cheers

[mw7485]

Each pension provider gets their own tax code. Its a bit rough and ready to start with but it does settle down. I strongly advise you to register for, and make use of the HMRC app - its the only way you really get to see what is going on tax wise (who is paying what, and how much is getting skimmed off in tax) as most pension providers will only send you a payslip out when your payment changes "significantly". I have found the RMSPS is the worst at applying the correct tax code and only know that because of the app.

[max49]

If you go onto the hmrc and register
https://www.gov.uk/log-in-register-hmrc-online-services
Then you can see the income sources, eg pensions and it will give their annual income. If you do not agree with their figures you can submit an update. There are also details of the tax code for each pension. I have found it very useful for keeping track and if there are any changes they send me an alert to check my account, I think you have to opt- in for this.

[freespeech]

My wife is drawing two RM pensions and has a low hours PT job too. The HMRC app has allowed her to proportion her tax free amount between the three incomes so no tax is paid.

[Wullie10]

I've registered. Very helpful thanks

[Engy]

I'm in second month of recieving pension and it's being taxed, will I get that refunded if I don't earn over 12k?

[RobertT]

I'm in second month of recieving pension and it's being taxed, will I get that refunded if I don't earn over 12k?

I take it you're referring to your RM pension?

The personal tax allowance is £12,570 so if your income is below that during the tax year, you should get a refund of any income tax paid.

If you sit tight that should happen automatically, but it may take a while.
Or, contacting HMRC may speed it up a bit.

[Engy]

Yea was talking about the RM pension Robert. It's only a few hundred pounds over the 12750 but been taxed full so far, plus with it not starting until may it will fall below the 12750.
Thanks for your reply

[mrcurve]

I'm in second month of recieving pension and it's being taxed, will I get that refunded if I don't earn over 12k?

I recommend calling the tax office, they can make the adjustments staight away, its best to call early in the morning, it can be slow getting through, although the website is useful, unless its has recently changed, its not something that can be done on the web.