You have confirmed the following:
If contributions are paid to my Moneybox Pension, I declare that:
- I am under age 75 and am a relevant UK individual under Section 189 of Finance Act 2004 (see Note 1, below);
- the total of the contributions paid to this Scheme and to other registered pension schemes, in respect of which I am entitled to tax relief, under section 188 of Finance Act 2004, will not exceed, in any tax year, the higher of:
- the basic amount (see Note 2, below), or
- my relevant UK earnings as defined in Section 189 of Finance Act 2009 (see Note 3, below) in that tax year;
- the declaration in (b) is correct, to the best of my knowledge and belief;
- I will give notice to Moneybox if an event occurs, as a result of which I will no longer be entitled to relief on contributions, under section 188 of Finance Act 2004. I will give this notice by the later of:
- 5th April in the year of assessment in which the event occurs; and
- the date which is 30 days after the occurrence of that event.
I will inform the Pension Provider, via Moneybox, if I am or become subject to the Money Purchase Annual Allowance Rules as a result of flexibly accessing pension benefits from any pension plan after 6th April 2015, and provide the date that this occurred.
Note 1: You are a relevant UK individual for a given tax year if you:
- have relevant UK earnings (see Note 3) chargeable to income tax for that tax year; or
- are resident in the United Kingdom at some time during that tax year; or
- were resident in the UK at some time during the five tax years immediately before the tax year in question and were also resident in the UK when you opened the Moneybox Pension; or
- you or a spouse have, for that tax year, general earnings from overseas Crown employment subject to UK tax (as defined by section 28 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA)).
For those who fall within (b) to (d) above and who do not have relevant UK earnings, the maximum member contribution is the basic amount (see Note 2).
Note 2: The basic amount is currently £3,600 (including tax relief).
Note 3: Relevant UK earnings
As a general rule, most earned income counts as relevant earnings. Income that generally doesn’t count includes pension income, dividends and most rental income.
Relevant earnings, as defined by HMRC are:
- employment income such as salary, wages, bonus, overtime, commission providing it is chargeable to tax under Section 7 (2) Income Tax (Earnings and Pensions) Act 2003 (ITEPA);
- income derived from the carrying on or exercise of a trade, profession or vocation (whether individually or as a partner acting personally in a partnership) chargeable under Part 2 Income Tax (Trading and Other Income) Act 2005;
- Rental income is generally not relevant earnings. Some rental income may be included if it relates to UK or EEA furnished holiday lettings under Part 3 of Income Tax (Trading and Other Income) Act 2005 (ITTOIA 2005);
- Patent income, meaning royalties or other sums paid for patent use where the individual alone or jointly devised the invention for which the patent in question is relevant earnings in certain specific categories (charged to tax under section 579 ITTOIA 2005, amounts on which tax is payable under Section 587 ITTOIA or section 593 ITTOIA, amounts on which tax is payable under section 472 (5) of the Capital Allowance Act 2001 or paragraph 100 of schedule 3 to that Act.)
Where relevant UK earnings are not chargeable to income tax in the UK due to double taxation agreements, they are not relevant earnings.
The first £30,000 of a redundancy payment is not chargeable to income tax and so doesn’t qualify as relevant earnings.