When am I considered a Higher Rate Taxpayer

TC1 · 4 February 2011 at 8:16PM

Are the following considered part of your gross pay and are they taxable ?

Housing/rent allowance

Competency related threshold payment.

Thanks TC1

Mikeyorks · 4 February 2011 at 8:51PM

TC1 wrote: »

2) Housing/rent allowance

1) Competency related threshold payment.

1) I'm assuming this simply relates to a salary increment / stage based on attaining a certain level of competency in the job? Definitely part of pay and taxable.

2) Similarly taxable ..... unless it relates to removal expenses.

http://www.hmrc.gov.uk/manuals/eimanual/EIM11307.htm

TC1 · 4 February 2011 at 9:34PM

Thanks for the reply Mikeyorks.

I'll start doing my sums.

Cheers again

TC1

climberup · 4 February 2011 at 10:10PM

If you are going to be just over the higher rate limit you really must invest however much you would pay higher rate tax on into a Personal Pension, and thus convert yourself back to a basic rate taxpayer. Specially if you are claiming Child Benefit.

sunshinetours · 7 February 2011 at 10:04AM

climberup wrote: »

If you are going to be just over the higher rate limit you really must invest however much you would pay higher rate tax on into a Personal Pension, and thus convert yourself back to a basic rate taxpayer. Specially if you are claiming Child Benefit.

I wouldn't say must....

People seem to forget the difference between basic and higher rate when you factor in national insurance is not that much on the extra income.
Obviously if it means child benefit is removed that may be a bigger incentive

Not everyone likes pensions and unless you can put away the cash until at least 55 its not an option for everyone.

Just another side of the story

When am I considered a Higher Rate Taxpayer

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