Most of you will be aware by now that the 2023 – 2024 Pension Savings Statements (PSSs) will not be issued until after the middle of January 2025. This is a knock-on effect because of the delay in producing the Remediable Pension Saving Statements (RPSSs).
We understand that some members are concerned that their 2023-2024 PSS may not arrive until after the HMRC Self-Assessment Tax Return (SATR) deadline of 31st January 2025. You will only be sent a PSS if you have breached the Annual Allowance (AA) limit for the tax year (TY) in question and even then, you may not have a tax charge if you have sufficient carry forward from previous years to offset the breach.
The AA limit was increased from £40k to £60k on 6th April 2023 and, allowing for the relevant CPI increase, it is anticipated that fewer members than usual will breach the AA limit for the TY2023 – 2024.
It is important to complete your SATR before the deadline to avoid a late return penalty and possible interest charges, even if you have not yet received the 2023 – 2024 PSS. In this instance it is possible to enter a figure in the required field and indicate it as ‘provisional’. You can explain in the ‘Any other information’ box why the figure is provisional.
It is important to note that the guidance from HMRC is:
Members will not incur a penalty for incorrect provisional figures, however, there may be interest charged. Interest will be charged where:
1. The amended figure is greater than the provisional figure provided, and
2. The member paid the tax charge themselves, rather than use Scheme Pays.
Because of this it is important not to underestimate the provisional figure.
If you anticipate that you may breach the AA limit you should calculate a provisional figure to the best of your ability. An example of how to do this can be found in your RPSS (if you received one) which shows how the TY2022 – 2023 Pension Input Amount (PIA) was arrived at. If you didn’t receive an RPSS, examples of PIA calculations are shown in any previous PSSs you have received.
If you have already submitted your SATR with a provisional figure and believe it to be lower than it ought to be, you can revisit your SATR before 31st January 2025 and update the provisional figure in order to avoid interest charges.
The CPI rate to be applied at the start of the TY2023 – 2024 is 10.1%. You can use the ‘total value of your pension pot on 5th April 2023’ as the starting value for the 2023 – 2024 calculation (remembering to uplift it by 10.1%).
We recommend that you read the HMRC FAQs on how to deal with your SATR and PSS for the TY2023 – 2024, which you can find here
