When does the K Code arrive?

Goldiegirl

Blue_Parrot wrote: »

The short answer is yes. In my own case it happened automatically. They're both government and talk to each other. The long answer is that State Pensions are not pre-taxed - how could they be? Therefore the State Pension is taxed after receipt. They (the Revenue) know you're getting it, therefore after they (pensions department) start paying it, then they (Revenue) start taxing you on it.

There is a philosophical debate to be had, viz: I've paid into the State all my working life by law, so why when I'm old enough to be paid the State Pension, do they tax me on it? One answer is that the Revenue will tax anything it can............

HTH

Thank you - my husband and I are so used to micro managing our tax affairs, it'll be nice to have something done automatically for once.


With regard to the philosophical debate, it could be said they're not really taxing you on the state pension....it's your other income you are paying tax on. Probably doesn't make it any more palatable, though!

CLAPTON

sheramber wrote: »

State pension is taxable because you didn't pay tax on the money deducted for your NI contributions. NIC is deducted before tax is calculated.

You have a personal allowance of tax free income and any income in excess of that amount is taxable.

sadly this is not so

you are taxed on your whole salary
and your NI is based on your whole salary

if you pay into a pension then tax is based on the salary less pension contribution but that is another story

xylophone

http://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/how-is-my-state-pension-taxed

Your husband should check at the end of the tax year that he has paid the correct amount of tax.