What happens to my self assessment tax return if I'm paying into a pension?

Depending on the type of pension scheme you're using, making regular contributions to it can change your tax calculation. If you're getting a pension but still working, you may have to file a self assessment tax return whether you're self-employed or not.

The main pension options are:

  • Employer's scheme: The basic pension plan. You don't have to do anything, as it's all taken care of at source.
  • Private pension: this option takes a little more paperwork. You'll still be taxed on your full income, but can claim tax relief to top up your pension contribution.
  • Salary sacrifice: this is where you're taking a reduced salary in return for pension contributions from your employer. This can cut down your National Insurance payments, and can be quite an efficient option.

If you’ve taken part of your pension pot without emptying it and won’t be taking regular payments from it, you'll need a P55 to claim back tax paid on that money if your pension body can’t give you a tax rebate itself.