Tax Relief for Non-Taxpayers

If you are not a UK taxpayer you are also entitled to tax relief on your pension savings, if your pension savings scheme meets the tax relief terms and conditions. Your scheme provider will be able to inform you whether or not this is the case. If your scheme entitles you to tax relief, this should be added automatically to your pension scheme savings; if you are uncertain ask your pension scheme provider about their scheme's system. However, non-taxpayers can claim tax relief on only £3,600 of their yearly pension savings contributions. This £3,600 limit includes all tax relief and scheme provider bonuses. Thus a non-taxpayer can make a maximum of £2,808 of pension contributions each year which will earn tax relief. If you are a non-taxpayer you can contribute more than £2,808 to your pension savings scheme each year but you will not be entitled to tax relief on any extra contributions as these will exceed the yearly limit of £3,600.

Depending on the terms and conditions of your pension savings scheme you may be entitled to extra bonuses from your scheme provider for the contributions you make as a non-taxpayer. If your scheme provider offers these bonuses they will not be affected by tax relief: you will be entitled to tax relief and your bonuses. Again, it is worth consulting the fine print of your savings scheme contract to see whether your pension scheme provider imposes any limits on the amount of extra bonuses you are entitled to each year. It is always better to double check that you are not missing out on an opportunity to make better returns on your savings.