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Absolutely nothing, which is what mega corporations do and chancellors wives. Yet they get lambasted for it. 
Higher rate tax band - things to be aware of?
- Thread starter NotAGolf
- Start date
Man of Honour
Absolutely nothing, which is what mega corporations do and chancellors wives. Yet they get lambasted for it.
I agree. I think it's a non issue with Rishi's wife but of course it makes the news because people love a good rant.
I thought all employers had to offer a pension scheme now?
I'd want to avoid doing an SA if possible. PAYE makes life so much easier.
Also keep in mind you are actually going from 32% to 42% total tax deduction (plus whatever that new tax is). So hardly something to be scrambling over to get your income down below the threshold.
Now if you are at 100k and taxed at a painful 62% then I could understand.
I'd want to avoid doing an SA if possible. PAYE makes life so much easier.
Also keep in mind you are actually going from 32% to 42% total tax deduction (plus whatever that new tax is). So hardly something to be scrambling over to get your income down below the threshold.
Now if you are at 100k and taxed at a painful 62% then I could understand.
They do, and please do not just assume that PAYE will do it all for you.
I ended up with a 10k bill they wanted to take immediately because I thought "I am on PAYE, so that will sort it out".
If you have any doubt speak to HMRC, takes names/dates of people you speak to and get any guidance they give you in writing. As they will often get it wrong.
For a pension deducted straight from your pay check? Sounds like a terrible admin. I suspect 95% of schemes are fine. It's not something I've ever had to worry about across multiple employers.
Sorry, for pension is likely fine, but I meant in general, PAYE is far from perfect.
Ok yeah, if the code is wrong or work multiple jobs etc. then you could potentially end up with a massive bill. So need to at least keep an eye on that.
Soldato
I was owed thousands in pension tax relief due to being PAYE because the reclaim is my responsibility not my employer's. Assuming that PAYE means you don't need to bother with Self Assessment can be a very costly mistake.
Man of Honour
A lot of people learn this the hard way unfortunately.
What do people do about bonuses? We have to set our salary sacrifice options at the beginning of the year, so AVCs are set then (based on £ or % value). If with AVCs (or other options) brings you just under 50k and then you get a bonus at the end of the year, will shunt you into the 40% bracket.
Do you make an estimate of how much you might get and make allowances for it? I don't get any control over my bonus and it has ranged from a few hundred, to over an extra months pay.
Do you make an estimate of how much you might get and make allowances for it? I don't get any control over my bonus and it has ranged from a few hundred, to over an extra months pay.
Soldato
You would include the bonus with your self assessment so wouldn't need to know what it was at the start of the tax year.
I don't think it's completely a non-issue. Whilst she's not broken any laws, it's clearly a loophole that should have been closed years ago when India had also changed their tax rules. If she's non-dom which would mean the UK isn't her permanent home, there should also be rules on how long you're allowed to stay in the country for. I'd bet she spends most of the year here as that's where husband works and where her children go to school etc, so it seems a bit farcical to claim the UK isn't your permanent home.
I don't understand what difference that would make though? I'm fully PAYE, so any bonus at the end of the year would be declared by my employer, but would then take me over the 40% threshold. I wouldn't have any way of reducing my taxable amount via additional pension contributions because those have to be set at the start of the year.
Pension contributions are something you can actually change every month. Although that requires your employer putting in the effort.
Man of Honour
Well if she's not breaking the law then I have no issue with it.
I guess it can be seen as taking the ****, however I do my best to minimise what I pay in the countries where I have assets, why wouldn't she do that too?
I suppose it depends on perception from others which is what politics is all about.
Yeah unfortunately mine has to be set at the start of the year. So I can ensure I don't fall into the 40% boundary by estimating my earnings and making the AVCs at the start, but a bonus can really throw a spanner into the works.
Soldato
That's terrible advice, you really shouldn't be posting stuff like that.
The pension provider may let you make contributions directly. You won't get the NIC savings that you would with salary sacrifice but better than nothing