Read on Twitter
1/ A thread about annual allowance in 19/20
Many of you will have received one of these nasty brown envelopes from @nhs_pensions this week. If you have (and even if you haven't) you may need to take action. Pay attention and share (please RT) with colleagues who may need this!
Many of you will have received one of these nasty brown envelopes from @nhs_pensions this week. If you have (and even if you haven't) you may need to take action. Pay attention and share (please RT) with colleagues who may need this!
2/ First of all you need to establish if you have an AA liability in 19/20. To do that you can use the free HMRC calculator. Its not that straightforward, but I would strongly advise to do your own calculations, even if you have an accountant/advisor.
3/ You can watch my video here. I did it for the 18/19 tax year, but its the same as the 19/20 tax year and I have updated the accompanying spreadsheet
4/ As noted in the video, DON'T assume if you haven't received an envelope you don't have an AA charge. The scheme do not know if you are "tapered" (i.e. your taxable income was over ÂŁ110k) so your available allowance maybe as small as ÂŁ10k.
5/ Similarly you might not have received one because your employer / PCSE have not updated the pension agency. So if you haven't received a PSS, request one today. You can use this template here: https://docs.google.com/document/d/1T-dJXxotLRAP8fkSwtQWPYBPIeScKLcMM8jlHadyhhk/edit
6/ OK so now, having watched the video, and used the tool / HMRC calculator, you should know if you have an AA charge for 19/20.
7/ VERY IMPORTANT: If you are an eligible clinician in England and Wales, and have an AA charge in 19/20, you would be MAD to pay the charge yourself. NHS England & Welsh government have a scheme to compensate you FULLY if you pay the charge via scheme pays
8/ The details of the scheme and FAQ are here:
https://www.england.nhs.uk/pensions/
IMPORTANT: You MUST apply for scheme pays by 31st July 2021 to be eligible for this compensation, and to use scheme pays
https://www.england.nhs.uk/pensions/
IMPORTANT: You MUST apply for scheme pays by 31st July 2021 to be eligible for this compensation, and to use scheme pays
9/ IMPORTANT: Even if you don't have the required information from the scheme/PCSE/Capita to know your exact charge, you MUST apply for scheme pays by 31st July 2021 - you can estimate your charge and have 4 years to amend this
10/ So you must apply for "scheme pays" using a "nomination form" - that's called an "SPE2" form in England. Like all things related to this stupidly complicated tax, that a slightly involved process - you can watch a video how to do it here:
11/ I have updated the calculator tool referenced in that video for the 19/20 tax year/scheme pays. But remember if you are eligible to use the England & Wales compensation scheme, do NOT pay the charge yourself, get a scheme pays loan
12/ Many of you will be aware of the ongoing "age discrimination" or "McCleod" case. There is an ongoing consultation about this which closes on 11th October. If you haven't already responded, please do so here:
http://bit.ly/SaveNHSPensions
http://bit.ly/SaveNHSPensions
13/ Please don't ignore your 19/20 AA tax liability because of the legal case - even if you think your AA tax charge may disappear if you revert to the old schemes.
14/ And definitely don't lose the opportunity to access the scheme pays compensation scheme (deadline 31st July 2021 - don't miss it!). In addition to the scheme pays election described above, there will be a simple form to fill in as well
https://www.england.nhs.uk/pensions/
https://www.england.nhs.uk/pensions/
15/ In summary - no-one is going to magically send you a bill for your AA charge
YOU need to request a savings statement if you dont have one.
YOU need to calculate if you have a charge.
YOU need to tell HMRC you have a charge.
YOU need to pay the charge (scheme pays if E&W)
YOU need to request a savings statement if you dont have one.
YOU need to calculate if you have a charge.
YOU need to tell HMRC you have a charge.
YOU need to pay the charge (scheme pays if E&W)
16/ And finally I cannot in good conscience do a thread about AA without saying what a throughly stupid tax this is. It really is a completely inappropriate tax in the context of a DB scheme, and must be scrapped, as per the OTS recommendation
#ScrapAAinDB
#ScrapAAinDB
17/ Clinicians would in any event be busy dealing with winter pressures, even without the added strain from COVID, & really shouldn't be dealing with this hideously complex & thoroughly unfair tax. Do the right thing @RishiSunak & #ScrapAAinDB
Please RT & share with colleagues
Please RT & share with colleagues
