P60 on state pension??

[mutantpoodle]

I usually submit my online tax return mid April and get overpayments back within a few days
but
now I am receiving the state pension

will I get a P60 on this pension.?? because without one it will make tax return much harder

[tjh290633]

No, you will not. When you do your self assessment, the HMRC will have the amount that you have received from the DWP and the appropriate box will already have the number in it. Just make sure that they have the right figure, and that the Winter Fuel supplement and the Christmas bonus have not been included. It will include the weeks before 5th April, which you may not be paid until later, assuming that you are being paid 4-weekly.

TJH

[Alaric]

will I get a P60 on this pension.?? because without one it will make tax return much harder

I think you are expected to take the weekly amount and multiply by 52. That doesn't always exactly correspond with what you receive in a tax year. If they collect the tax by adjusting the PAYE code if you have one, that being monthly and the State pension weekly, there's a slight mismatch.

[Chrysalis]

No, I don’t think so. I do my father’s tax and he gets a P60 for all annuities and private pensions, but just gets a notification from DWP every year about the amount of state pension. The state pension always uses the personal allowance first before other income, so no tax is payable on it for most people.

[XFool]

will I get a P60 on this pension.?? because without one it will make tax return much harder

I think you are expected to take the weekly amount and multiply by 52. That doesn't always exactly correspond with what you receive in a tax year. If they collect the tax by adjusting the PAYE code if you have one, that being monthly and the State pension weekly, there's a slight mismatch.

This again!

I have taken to keeping a spreadsheet showing three figures: The quoted HMRC figure, 13 x the usual four weekly payment figure as received and finally the total amount actually received in the tax year, regardless of what week it is supposed to be for.

So far the last one, money received in tax year, seems to more or less mirror the HMRC figure. As for the 13 x method, not all 13 payments are necessarily equal and there are not always as many as 13 payments made during a tax year.

[Lootman]

I have taken to keeping a spreadsheet showing three figures: The quoted HMRC figure, 13 x the usual four weekly payment figure as received and finally the total amount actually received in the tax year, regardless of what week it is supposed to be for.

So far the last one, money received in tax year, seems to more or less mirror the HMRC figure. As for the 13 x method, not all 13 payments are necessarily equal and there are not always as many as 13 payments made during a tax year.

Sounds like HMRC are taking a theoretical figure for pension received rather than the actual figure. That could clearly be wrong in any and indeed every tax year, but over a number of years it will even out and amount to the same thing.

In that sense it is different from the treatment of some other types of income, such as dividends and interest, where the actual date of receipt matters. But is closer to the way rents are treated, where account is taken of the period the rent is for rather than the date of receipt of the rent. So for example if you receive a cheque for April's rent from your tenant, you are supposed to allocate 5/30 of that to the prior tax year and 25/30 to the following tax year. I suspect thousands of BTL landlords don't bother and it's not a problem. But since HMRC will independently receive data from DWP it's perhaps prudent to treat state pension payments in the way HMRC specifies regardless of how counter-intuitive that is.

[XFool]

But since HMRC will independently receive data from DWP it's perhaps prudent to treat state pension payments in the way HMRC specifies regardless of how counter-intuitive that is.

But this seems to be the problem I encountered. How does HMRC expect you to treat it? Different explanations, from the paper sheets in different years and the online help sheets seem to describe varying methods. A common one is the 13 x four weekly, or 52 x weekly. But these seem to give a different result to the rounded figure already posted by HMRC in the online tax return.

This is why I decided to go with the total paid in the tax year, regardless of which week it was supposed to be for. An alternative would be to just accept the given HMRC figure. Do other people bother with all this?

[PinkDalek]

But this seems to be the problem I encountered. How does HMRC expect you to treat it? Different explanations, from the paper sheets in different years and the online help sheets seem to describe varying methods. A common one is the 13 x four weekly, or 52 x weekly. But these seem to give a different result to the rounded figure already posted by HMRC in the online tax return.

This is why I decided to go with the total paid in the tax year, regardless of which week it was supposed to be for. An alternative would be to just accept the given HMRC figure. Do other people bother with all this?

I’ve never seen them say use 13 x 4 etc. They say you are taxed based on entitlement, not receipt. See the latest Tax Return and Notes below:

https://www.gov.uk/government/uploads/s ... 0_2017.pdf
https://www.gov.uk/government/uploads/s ... 0-2017.pdf

The first State Pension I encountered I tried to calculate the correct figure and was corrected by HMRC in the Tax Calculation (paper returns btw). Since then I’ve taken the State Pension (not mine) as shown on the Notice of Coding and, unsurprisingly, this has never been amended.

In the first year it is not so simple but an accurate stab should be possible looking at the entitlement letter or whatever the precise term is.

[XFool]

They say you are taxed based on entitlement, not receipt. See the latest Tax Return and Notes below:

https://www.gov.uk/government/uploads/s ... 0_2017.pdf
https://www.gov.uk/government/uploads/s ... 0-2017.pdf

The first State Pension I encountered I tried to calculate the correct figure and was corrected by HMRC in the Tax Calculation (paper returns btw). Since then I’ve taken the State Pension (not mine) as shown on the Notice of Coding and, unsurprisingly, this has never been amended.

In the first year it is not so simple but an accurate stab should be possible looking at the entitlement letter or whatever the precise term is.

"State Pension - amount you were entitled to receive in the year, not the weekly or 4 weekly amount - read the notes

Box 8 State Pension
Use the letter ‘About the general increase in benefits’ that the Pension Service sent you to find your weekly State Pension amount.
Add up the amount you were entitled to receive from 6 April 2016 to 5 April 2017 and put the total in box 8."

"entitled to receive"? Ye Gods I can't be bothered with all this. So just go with the online pre-filled figures from HMRC? (Presumably the same as the PAYE Coding figure) These usually seem to be both a few quid less than the amount actually received in the tax year and rounded down.

[Chrysalis]

Interestingly for child benefit charge my accountant advised to use the amount received.
Surely amount entitled to is the most difficult to work out!!

[pochisoldi]

Interestingly for child benefit charge my accountant advised to use the amount received.
Surely amount entitled to is the most difficult to work out!!

How's that?

Count the number of weeks since last year, split that number into two, one for the rate at the start of the year, one for the rate at the end of the year. Multiply those figures by the appropriate weekly rate then add together. Insert figure into tax return, make a note of the "last week" for when you work out next year's figure. The only difficult issue is figuring out whether the last week of the tax year is in this year or next (simple rule - a week belongs to the tax year with at least 4 days).

If only HMRC/DWP wrote this down and put it in a leaflet...

Pochisoldi

[XFool]

Count the number of weeks since last year, split that number into two, one for the rate at the start of the year, one for the rate at the end of the year. Multiply those figures by the appropriate weekly rate then add together. Insert figure into tax return, make a note of the "last week" for when you work out next year's figure. The only difficult issue is figuring out whether the last week of the tax year is in this year or next (simple rule - a week belongs to the tax year with at least 4 days).

If only HMRC/DWP wrote this down and put it in a leaflet...

Well yes!

Though I still doubt I will bother...

[XFool]

I am (was; hope to be again - that's another story!) running a spread sheet on, this comparing several different figures for State Pension:

52 x Weekly DWP figure
Actual SP payments received in Tax Year
HMRC SP figure from Coding Notice

They are different. Possibly simple versions (52 x DPW weekly; 13 x DWP monthly) balance out over a 4 year calendar cycle, with the total coming to the same as the HMRC totals over the same period. Don't know yet...

So far (from memory!) the HMRC figure corresponds most closely to the actual sum received in year, which of course does not generally consist of 13 equal monthly payments.

[Alaric]

I am (was; hope to be again - that's another story!) running a spread sheet on, this comparing several different figures for State Pension:

Something of a mess really with the clash between the weekly orientated State Pension and the monthly orientated PAYE on occupational and personal pensions.

You might hope that the various teams of civil servants could be locked in a room and not let out until they had agreed on a consistent system for tax reporting and charging. The solution for some might be to put State Pension onto PAYE, not that it would work terribly well for those collecting it weekly from the Post Office.

[XFool]

Something of a mess really with the clash between the weekly orientated State Pension and the monthly orientated PAYE on occupational and personal pensions.

AFAIK the problem stems from the tax year starting on the same calendar date every year, while pensions are paid on one fixed day of the week (per pensioner) irrespective of the calendar date.

Oh, just realised that my recent post was in effect a repeat.

[Bouleversee]

I remember one year adding up the total amounts I had received, paid weekly, and it didn't correspond with what they said was the annual amount. Now I just dig out the letter they send stating what I am entitled to and put that down.

[XFool]

I remember one year adding up the total amounts I had received, paid weekly, and it didn't correspond with what they said was the annual amount. Now I just dig out the letter they send stating what I am entitled to and put that down.

But, if that is the DWP letter, it only gives a weekly figure for SP entitlement not the annual sum as required by HMRC Tax Returns!