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Totally confused - Pension advice please!
Comments
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There are buy back options on some annuities as well now for those that die and havent had the full amount of their capital paid out yet in annuity income.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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If you have children and get working/childrens tax credits, then pension contibutions can increase the amount you get. In effect, this increases the amount of tax relief making pensions the better option as you can get upto the equivalent of 72% tax relief effectively. ISAs get nothing.
I think you are talking of Higher Rate Taxpayers getting working/childrens Tax Credit? Is that very common?0 -
Getting the 72% would need you getting the childcare side and just having the right income. However, the pension contribution lowers the income for calculation purposes so if the income is lower, the tax credit goes up. Certain income levels can get quite a boost. For example, if you are just over the qualifying income for tax credits, then the pension contributions could bring you below that level and you then get credits.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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I am still not sure if it only applies to Higher Rate Taxpayers? If it does then the OP can never get 72% relief as he is appears to be a Basic Rate taxpayer.0
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To get 72% you would need to be higher rate. However, that doesnt stop basic rate taxpayers getting some more. However, they will certainly be getting at least 18% less.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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Salary Sacrifice for even basic rate tax payers is high:
Full benefit
=65.9% increase on £1 net
If Employer keeps the benefit of not paying employer NI
=47.1% increase on £1 net0
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