Tax trap and using a SIPP
- Thread starter aspiring
- Start date
Forget a SIPP, you need ASIF (Azza Special Investment Fund).
Tax free and not only excellent market beating returns (18% YTD) also ESG, so you can sleepy safely knowing you're making money while saving polar bears.
PM for more details.
Past performance is not an indicator of future returns. Capital at risk. Minimum buy-in terms apply. You may get back less than you paid in.
Tax free and not only excellent market beating returns (18% YTD) also ESG, so you can sleepy safely knowing you're making money while saving polar bears.
PM for more details.
Past performance is not an indicator of future returns. Capital at risk. Minimum buy-in terms apply. You may get back less than you paid in.
Soldato
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You certainly like starting threads where you can mention that you earn over £100k p.a.
Soldato
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There are no competent FA, have you seen the mess they’ve made of VAR?
Associate
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Not sure why you're referencing take home amounts to tax thresholds.
In theory yes provided that when you say taking home you mean gross, but two things really, 1) you need financial advice from a pro, 2) it's going to depend on the split for simplicity, you may be better leverging paying more into an employer pension and seeing if they'll match, your self employed, are you making the right financial decisions for this, i.e. are you claiming enough, would you be better ltd etc etc I'm assuming this is an OE style arrangement you've got going on so you really need a pro.
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Adjusted net is where the 100k pain kicks in.
Short answer is yes. Long answer is yesssssssssssss
This sounds like a great idea. I would second this ASIF idea.
Soldato
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Best "I take home over 100k" thread evar.
7.1 / 10
ASIF. As if. As Piring. Would read again.
7.1 / 10
ASIF. As if. As Piring. Would read again.
Deleted member 266365
D
Deleted member 266365
What is 119-20? If you cannot answer that who the **** is paying you over £119k to work for them?
Why don’t you just max out your employer’s pension plan?
Unless you’re planning to be totally self employed at some point. Even if they don’t contribution match or just to certain point, it saves you the time and effort of setting up a SIPP, setting up the transfer, filling in the tax paperwork and looking into what to actually invest in with the SIPP.
This will reduce the gross income for one of your income streams and lower your taxes at source.
Speak to the people who you work with to find out how they reduce their taxes, there maybe other companies plans like shares, car leases, buying extra holiday and medical plans that maybe useful to yourself and reduce your net income.
Unless you’re planning to be totally self employed at some point. Even if they don’t contribution match or just to certain point, it saves you the time and effort of setting up a SIPP, setting up the transfer, filling in the tax paperwork and looking into what to actually invest in with the SIPP.
This will reduce the gross income for one of your income streams and lower your taxes at source.
Speak to the people who you work with to find out how they reduce their taxes, there maybe other companies plans like shares, car leases, buying extra holiday and medical plans that maybe useful to yourself and reduce your net income.
Soldato
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OP you missed out the decimal point
more like 11.9k
more like 11.9k
Soldato
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You'll receive tax relief on the SIPP contributions. So, you'll have 25% relief added to your SIPP and if a 40% tax payer, the rest will be returned via self-assessment. If employed this will likely be via a bump in your tax code.
Effectively yes, as if you were earning 20k less, at least in terms of tax.
Effectively yes, as if you were earning 20k less, at least in terms of tax.
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Soldato
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Tell them I sent you.
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You already have the answer which is YES.
I got caught in this trap and only really twigged it when I left employment and didn't work for 4 months which reduced my taxable earnings to below the £100k and effectively restored my tax free personal allowance. Effectively having 4 months off work only cost me 2 months pay which was a nice bonus in my tax return. Saving £20k into a pension will effectively give you tax credit of 20% (£4k) which will be credited to your SIPP and c£12k back in personal allowance. It's a no brainer. One way of looking at it is that you will get £24k benefit for £8k cash and thats not counting the additional 20% you will get back in your tax return.
I got caught in this trap and only really twigged it when I left employment and didn't work for 4 months which reduced my taxable earnings to below the £100k and effectively restored my tax free personal allowance. Effectively having 4 months off work only cost me 2 months pay which was a nice bonus in my tax return. Saving £20k into a pension will effectively give you tax credit of 20% (£4k) which will be credited to your SIPP and c£12k back in personal allowance. It's a no brainer. One way of looking at it is that you will get £24k benefit for £8k cash and thats not counting the additional 20% you will get back in your tax return.