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  • FIRST POST
    • Workerbee999
    • By Workerbee999 17th Mar 17, 3:54 PM
    • 32Posts
    • 1Thanks
    Workerbee999
    Adjusted net income and P11d benefits
    • #1
    • 17th Mar 17, 3:54 PM
    Adjusted net income and P11d benefits 17th Mar 17 at 3:54 PM
    Hi

    This year my Taxable pay per my payslip for this tax year is going to be £97,631.

    However I have approximately £4,000 P11d benefits which are the reason my tax code is 707L rather than a full personal allowance of £11,000.

    I am trying to make sure that my adjusted net income does not go over £100,000 to avoid losing any of my personal allowance. To achieve this I would put any extra in my pension if necessary.

    The gov website says "money you earn from employment (including any benefits you get from your job)". This would suggest to me that I need to add the 4,000 p11d benefits to the 97,631, which is 101,631. So I would need to put around an extra £1,600 into my pension.

    I have asked my payroll dept but the only person available didn't seem too sure. I don't want to think it is fine now, and then get an extra tax bill in my tax code next year when the p11d benefits are submitted, if I can avoid it in advance.

    Can anyone confirm please?

    Thanks
Page 1
    • Credit-Crunched
    • By Credit-Crunched 17th Mar 17, 4:43 PM
    • 2,081 Posts
    • 4,093 Thanks
    Credit-Crunched
    • #2
    • 17th Mar 17, 4:43 PM
    • #2
    • 17th Mar 17, 4:43 PM
    Hi

    This year my Taxable pay per my payslip for this tax year is going to be £97,631.

    However I have approximately £4,000 P11d benefits which are the reason my tax code is 707L rather than a full personal allowance of £11,000.

    I am trying to make sure that my adjusted net income does not go over £100,000 to avoid losing any of my personal allowance. To achieve this I would put any extra in my pension if necessary.

    The gov website says "money you earn from employment (including any benefits you get from your job)". This would suggest to me that I need to add the 4,000 p11d benefits to the 97,631, which is 101,631. So I would need to put around an extra £1,600 into my pension.

    I have asked my payroll dept but the only person available didn't seem too sure. I don't want to think it is fine now, and then get an extra tax bill in my tax code next year when the p11d benefits are submitted, if I can avoid it in advance.

    Can anyone confirm please?

    Thanks
    Originally posted by Workerbee999
    It does not actually reduce your personal allowance, you still have the 11k. HMRC juut adjust your tax code to allow for the P11d Value.

    You adjusted net income in your case will be salary, plus p11d value less any GROSS personal pension contributions. So your assumptions are correct

    The personal allowance is taken off AFTER this, so your total income is

    £97,631 + £4,000 = £101,631. You will need to pay in £1305 (1631 * .8) to ensure your salary stays under 100k.
    • Dazed and confused
    • By Dazed and confused 17th Mar 17, 6:43 PM
    • 1,858 Posts
    • 826 Thanks
    Dazed and confused
    • #3
    • 17th Mar 17, 6:43 PM
    • #3
    • 17th Mar 17, 6:43 PM
    Don't forget to include any other taxable income in your ani calculation, for example savings interest.

    All savings interest (excluding normal non taxable things like ISA's) remains taxable, even the personal savings allowance amount of £500 is taxable (at 0%) and counts towards your total income
    • Workerbee999
    • By Workerbee999 17th Mar 17, 6:48 PM
    • 32 Posts
    • 1 Thanks
    Workerbee999
    • #4
    • 17th Mar 17, 6:48 PM
    • #4
    • 17th Mar 17, 6:48 PM
    Thank you for the confirmation.

    I don't have any other income to take into account and my company offers salary sacrifice, so I assume I would just ask them to deduct the extra pension contribution of approx 1650 from my gross pay?

    Thanks
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