TAX on Pension & Part time

gatita

Please could someone look at the figures below to verify they are correct.

My husband aged 60 is now working part time 19.5 houra a week his tax code for this is 655L his net pay is £942.25 deductions Tax £127.20 gross £1.244.30

He also gets his work pension Tax code month 1 £ Pension £736.55,tax deduction £147.20
its all a bit confusing! would be very grateful for any input.

mjm3346

Tax on the pension seems about right (20% on it all), code would normally be BR for that. There should be no National Insurance to pay on the pension.

CLAPTON

guessing a bit but if he pays some pension deductions say 5% then it would go like this


655L is an odd taxcode but

employment
gross 1244.30
less pension payments of 62 giving 1182
less personal allowance of 6555/12 per month = 546 giving 635
so 20% tax on 635 = £127
and some NI



because his tax allowance is fully used by his employment then his pension will be taxed at 20%
so 20% of 736 = 147.20
and no NI

gatita

Clapton thank you SO much for your amazingly clear explanation, I really appreciate the time and effort you took in working it all out!