state pension and teacher's pension

whitesatin

I understand that my state pension will be paid (weekly, by choice) without tax deduction and that the tax will come off my teacher's pension. My question is will this settle down to a regular figure or will it fluctuate to reflect state pension payments received each month?

Linton

HMRC will assign you a tax code which will be used to determine the tax take from your pension. Same process as if you were employed - as long as the tax code and the tax rules remain the same the tax taken will as well.

Jack_Griffin

Interesting general point. do the teachers pension office manage PAYE including accounting for your state pension, maybe you'll be liable to file an annual tax return?

The similar situation must apply to anyone with collective pensions exceeding the personal allowance (which from April is £9,440 for people born after 5 April 1948 & £10,500 for people born between 6 April 1938 and 5 April 1948)

I'm sure someone will be able to explain the way pensioners tax is assessed & collected.

Bigmoney2

As I understand it , state pension is taxable but there is no machanism to tax it so the personal allowance is always higher than state pension.

Anything left after state pension is deducted from personal allowance is asigned to other pensions/income.

You will be issued this tax code by HMRC to be asigned to you teachers(or other) pension so that they can calculate your taxed income for the coming year and issue the pensions statement for that year.

Linton

Jack_Griffin wrote: »

.....

I'm sure someone will be able to explain the way pensioners tax is assessed & collected.

It's all here, the same as wages - the pension provider does a tax calculation based on the HMRC tax code.

JezR

The exception, which I have mentioned here before, is that if the income tax due is more than half the value of the pension paid through PAYE, then the tax over that amount has to be paid through self-assessment.

There are people who only have a state pension but which alone is big enough to be liable to pay tax which they have to pay through self assessment. The latest review put this at 39,000 people.

CLAPTON

I believe that your state pension will be paid every 4 weeks in arrears

molerat

whitesatin wrote: »

I understand that my state pension will be paid (weekly, by choice) without tax deduction and that the tax will come off my teacher's pension. My question is will this settle down to a regular figure or will it fluctuate to reflect state pension payments received each month?

The annual amount of state pension will be deducted from your tax allowance and applied to the teachers pension giving you a stable monthly payment.

xylophone

I believe that your state pension will be paid every 4 weeks in arrears

The OP has opted for weekly in arrears as have two soon to be pensioners of my acquaintance.


http://www.hmrc.gov.uk/incometax/codes-pensions-benefits.htm for coding and pensioners.

mrschaucer

Yes indeed, 4 weekly in arrears is the default option, but if you ask specifically for weekly in arrears when claiming, it is still possible.

kidmugsy

Ooh yes, we get ours weekly. Those nice people at the bank pay interest on it, you know.