Tax and pension related help please

stimpy2001

Looks like this is in the wrong forum, sorry. Any chance of a free ride to the right one.... Thanks

Looking for some advice for my dad please.

Tax code 795t, receives the state pension and an occupational pension.

Can anyone confirm that the state pension has already had tax accounted for, by the government adjusting the tax code. Therefore if the occupational pension is less than the allowance of £7950 no tax should be paid??

Or would you add the pensions together, deduct the allowance and pay 10% on the first £2k ????

Thanks for any advice.

dunstonh

The state pension is paid gross but the tax code should be lowered to take the state pension into account.

A tax code of 795 seems high for someone getting the state pension.

For example, the age 65-74 personal allowance is £7280 giving a tax code of 728. The state pension amount should be deducted from that. So a basic state pension fo £4381 a year would give a tax code of 289. So, 795 seems too generous. The T suggests it's a temporary code.

stimpy2001

Thanks for the reply.

His obvious concern is that he hasn't paid tax previously on his pension and his circumstances haven't changed.

Yet when his tax code does change to whatever it should be, his occupational pension will be over the allowance and he is worried about owing years of back tax......

sarahlouise210

The tax code is almost definitely wrong and he should contact his tax office asap. The `T` at the end of the code does not mean temporary - is just means that it has to be manually reviewed and not automatically updated by the computer each year

ctm_2

We need to know what the notice of coding shows (and what year it is for) before we know if the code is correct or not. I think it's a bit hasty declaring that the code is definately wrong. He may be due age related allowances and married couples allowance, and have the state pension already in the code.

So... what is shown on the P2 Notice of coding?

Peter-Pan_5

15000 yearly pension I have a job now of £24000 a year but have a tax code of BR should I be paying the 40% tax rate,its so worrying. Is the BR 22%?