We can work it out

Our client had a total income of £260 500 for 2009/10 and made a contribution to a SIPP of £80 000 (net) during the tax year.

The client does not normally make contributions to her pension plan so the anti-forestalling measures must be considered in relation to this ‘one-off’ payment.

The problem arises when trying to put the amount of restricted relief on the tax return. Where do you put the figure on the return? HMRC’s manuals are silent and the Tax Return Guide states: ‘If you pay tax at 40% you are entitled to further tax relief. We will work it out and give you credit in your tax calculation’.

This may be acceptable for the unrepresented taxpayer but our client expects our advice on the tax to pay by 31 July.

Surely having no set guidance means that some will enter the gross contribution on...