pensions

Seadog

War Hero
Moderator
#15
No. I understand how it works and how to avoid tax on large pensions, legally. My panther comment was related to your 'black-catting' a poster who pays 40% on part of his pension. I'm only sorry I thought that was obvious.
 

witsend

MIA
Book Reviewer
#16
No. I understand how it works and how to avoid tax on large pensions, legally. My panther comment was related to your 'black-catting' a poster who pays 40% on part of his pension. I'm only sorry I thought that was obvious.
' I lose 40% on 1 third of it!'

Since you know how it all works, how does that work?
 

Seadog

War Hero
Moderator
#17
Example:

Pension £15k, pay £32k

Income over £42k taxed at 40%.

So £5k (1/3 of pension ) is taxed at 40%.

For those paid >£42k, 100% of pension attracts 40%.

Round numbers used for demo. Pension isn't liable for NI contributions.

I have a handy web calculator which I'll link when I'm at at home.
 

Seadog

War Hero
Moderator
#19
I'm glad, I thought I was being a cock.

http://www.uktaxcalculators.co.uk/

The tax app isn't clever enough to split incomes between pension ( no NI) and wages ( NI) but I use it to
plan. Losing 40 % of income from any source is a bastard to be avoided at all legal costs. Work broad, foreign seagoing, stick anything in the 40% bracket in another pension.

With all income from pensisons and investments so no NI, one can have a net income of nearly 3k per month without going into the 40% band.
There is a website ( an HMG one) that calculates whether or not your up sticks move abroad takes you out of UK
tax jurisdiction. I was surprised to see how much you could leave behind ( house ) how often you could come back and be non domiciled for tax. All the whining about fat cats is so much pish. The rules apply and can benefit all.




I am not a financial advisor. Tax can go up, unlikely to go down, just saying.
 
#20
Seadog as an expat those allowances are getting smaller and smaller. At present I get a single mans tax allowance which is handy for the rental income from my property, however The Chancellor did mention in October that he is thinking of removing that allowance from expats.
 

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