Tax - Adjusted net income

Clive_Woody

Apologies in advance for what is most likely a naive question.

My total package for 2019/2020 tax year is likely to exceed £100,000 so from my understanding I will be required to complete a self assessment for the first time, plus I believe I could see my personal allowance reduced.

My income all comes from one employer and is all PAYE.

Salary: £90,005
Car allowance (taken as cash - PAYE): £8,532/annum
Home worker allowance: £207/annum
Health allowance: £360/annum

From my salary I contribute 7% salary sacrifice to pension (employer pays 10%) plus I will have made regular total AVCs of £2100 also by salary sacrifice - which by my calculations means my adjusted salary after SS is £81,605.30

I have been told that my bonus will be around £14,000 - I can SS part or all of this into my pension. I was thinking of maybe sticking half in my pension via SS and taking the rest, subject to tax/NI.

Where I am confused is the calculation of Adjusted net income - does HMRC include the amounts I have SS to my pension from salary and bonus, or do I add up the amounts after SS to see if this comes to £100K and therefore I start losing my personal allowance?

Thanks in advance for any guidance. It's a nice situation to be in, but the more I search Google, the more confused I get with the terminology and calculations.

BoGoF

HMRC will go by what your P60 shows as your taxable income......which should be the amount after salary sacrifice.

Clive_Woody

BoGoF wrote: »

HMRC will go by what your P60 shows as your taxable income......which should be the amount after salary sacrifice.

Thanks, very much appreciated and reassuring to hear.

So if I SS a suitable amount of my bonus to keep my total below £100k then I shouldn't lose any personal allowance or be required to completed a self assessment?

BoGoF

Clive_Woody wrote: »

Thanks, very much appreciated and reassuring to hear.

So if I SS a suitable amount of my bonus to keep my total below £100k then I shouldn't lose any personal allowance or be required to completed a self assessment?

Correct, but don't forget any interest/dividends etc that may tip you over the £100,000

Clive_Woody

BoGoF wrote: »

Correct, but don't forget any interest/dividends etc that may tip you over the £100,000

Thanks, that's all in my wife's name as she's a none earner.