Pension and Child tax credits.

beth111

After some advice pls. My OH pays into a work pension scheme. Will this effect our child tax credits in anyway? Good or bad.

Many thanks.

Icequeen99

beth111 wrote: »

After some advice pls. My OH pays into a work pension scheme. Will this effect our child tax credits in anyway? Good or bad.

Many thanks.

This comes up a lot on here. The answer is it depends. Most people with work pensions will have their pension contribution already deducted in their P60 figure, so your tax credits will be right. If you have a private pension you can deduct the contributions from the P60 amount.

My last response to someone might help:
Most occupational pensions are already taken into account on your P60 figure, so the figure that tax credits ask you for from the total taxable pay box of the P60 already has the pension deduction into account. In that case you are only paying tax on the figure after the contributions have been deducted, and that is the figure tax credits are based on.

If you pay into a private pension you can deduct the contributions from the P60 figure because they won't already have been taken into account.

The difference is explained here: http://www.hmrc.gov.uk/incometax/relief-pension.htm

For tax credits, see the TC825 form.

IQ