Joining your work sponsored pension scheme is a good start towards retirement planning. However, these days unless you are joining a final salary type scheme offered by the public sector, and have stayed in the same career for a considerable period of time, you need to check carefully that the benefits that you have received from your pension scheme will help you obtain and achieve your retirement goals.

It is possible to build up additional benefits in a self-invested personal pension (SIPP) to build up an additional pension pot to buy additional benefits (added years) to give you more income when retiring.

Here at Firth & Scott we strongly believe in retirement planning, not pension planning, and the most important aspect of all this is to have a plan in place which is reviewed and measured on a regular basis.

If you require help please ask your Independent Financial Advisor here at Firth & Scott to discuss with you our Lifetime Financial Planning Programme.

Who's to blame for underpaid tax?

Accountants Illiffe Poulter of Mapperley, Nottingham reminded us in their most recent newsletter whose fault underpaid tax sometimes is.

I recently experienced this situation with a client of mine who after completing online tax assessments for the last 4 years was suddenly presented with a bill for underpaid tax due to an incorrect coding being applied to an occupational pension scheme.

Where a tax payer has a number of jobs, or several pensions in a year, the PAYE system can get it wrong, leaving tax unpaid.

Where the employer/pension provider has not used the correct PAYE code and this causes any tax not to be collected it remains their responsibility not yours.

Unfortunately the Taxman is ignoring this piece of law and is demanding payment of the underpaid tax from employees and pensioners, where the error lies with the employer pension provider. Illiffe Poulter or your accountant can help you challenge the tax man on this point.

Sometimes the fault lies with the Taxman who has ignored information you or your employer has provided on more than one occasion.

The Tax Office may also have let tax arrears build up over 2 or 3 years without telling you.

If any of these situations apply you can ask the Tax Office to write off the tax owing under Extra Statutory Concession A19.

Illiffe Poulter advises that the Taxman is very reluctant to use this concession but they (or your own accountant) can help argue your case if you feel this is valid.

So lots of things to consider here and please do not hesitate in contacting your Independent Financial Advisor here at Firth & Scott.