can someone work my tax on my pension

gamston

hi
just really need that push to ask boss for early retirement.
i've roughly worked out my pension should be £31000 pa
with a small lump sum
which when i put it against my working pay less NI and pension contributions is around £3000 less
so by time i pay petrol costs to get to work, I think i'm getting about £10 a week more by going to work
but I still need that push, so could someone work out my weekly pension with tax deducted, sorry to ask but my brains not in a good place at the moment
pension is £31000 Tax code 13/14 is 890L
thanks

SeekTruth

gamston wrote: »

hi
just really need that push to ask boss for early retirement.
i've roughly worked out my pension should be £31000 pa
with a small lump sum
which when i put it against my working pay less NI and pension contributions is around £3000 less
so by time i pay petrol costs to get to work, I think i'm getting about £10 a week more by going to work
but I still need that push, so could someone work out my weekly pension with tax deducted, sorry to ask but my brains not in a good place at the moment
pension is £31000 Tax code 13/14 is 890L
thanks

To answer your immediate question: Tax code of 890L against gross pension of £31,000 means you will pay tax on £22,091 (£31,000 - £8,909). Tax rate of 20% on £22,091 means you'll pay £4,418.20 tax in year. So, pension after tax will be £26,581.80.

With such an important decision, please don't just take my word for it. Also, please double check your pension entitlement. I'd be interested in knowing what pension scheme would produce such an apparently generous pension as a percentage of your pay.

gamston

thanks
i'm in the railway pension scheme
but i've also been paying around £70pw into AVC for nearly 25yrs
so if i take a reduced lump sum i can get £31000pa
made up of £18000 scheme pay the rest avc payment

martinthebandit

Can I just say I have no idea about what your tax would be etc, but as someone who did exactly what you are thinking of doing a few years ago my advice would be.....


Go for it!

Athough after a couple of years of retirement I did go back to work but I now do a job because I enjoy it not for the money it pays.

KKmatters

If you wanted to check your income using HMRC calculator just visit their website enter tax code and amount of £ and frequency and it will return an accurate result.... :-)

If it's only worth £10/week to go to work I'd say go for it too

gamston

thanks for the help, yes it looks to me as if its only 310-20 a week extra to go to work
its just writing that letter, seems so hard to do

CLAPTON

well presumably your tax ocde of 890L for 2013-14 means you have benefit in kind

once you leave work presumably you will lose that so your tax code will increase a little

scottishgraeme

gamston wrote: »

hi
just really need that push to ask boss for early retirement.
i've roughly worked out my pension should be £31000 pa
with a small lump sum
which when i put it against my working pay less NI and pension contributions is around £3000 less
so by time i pay petrol costs to get to work, I think i'm getting about £10 a week more by going to work
but I still need that push, so could someone work out my weekly pension with tax deducted, sorry to ask but my brains not in a good place at the moment
pension is £31000 Tax code 13/14 is 890L
thanks

Hi found this by accident, I am an independent financial adviser who specialises in the railway, so i understand the different types of BRASS as well as the main pension scheme,/ section or scheme pay, restructuring premiums etc. Before you do anything get an official retirement projection from Pension's management, as this will show the full range of benefits such as level pension option should you qualify, as well as the higher or standard lump sum. find a good IFA who will consider and discuss all your options (and probably some you are not aware of) so if you decide to go early your making a fully informed choice.

gamston

got a pension projection on its way to me, but we now have interactive web page that gives a breakdown of whats available(but does not include the level pension.
so i have a rough idea of the differents in bigger annual pension V large Lump sum
i dismissed the level pension thinking that 10yrs time i could do with a boost to my pension

scottishgraeme

If your going early it would be advisable to investigate drawdown, this is not something which suits everyone, I don't know your personal circumstances but the flexibility and future inheritability may be an advantage for you, we are certainly finding people up here are becoming much more financially aware of the external options open to them. I am in the process of arranging a £1,000,000 drawdown for a client, I explained the drawdown to a XC driver yesterday he like many others had never heard of it and he is now taking advice on it.