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Pre retirement advice.

My wife is thinking of retiring at the end of September.Is there anything  we could be doing to take advantage her being a higher rate tax payer.Possibly investing a lump sum in a SIPP perhaps,to take advantage of the 40% tax relief.Any suggestions or advice would be greatly appreciated.

Comments

  • coyrls
    coyrls Posts: 2,518 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Given that she will only be working for half the tax year, will she be a 40% tax payer for 2020/21?  To be honest it's a bit late to be thinking about tax relief on pension contributions now.
  • Albermarle
    Albermarle Posts: 28,967 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    A higher rate taxpayer should put as much in their pension as they can afford/to reduce HRT paid to as close to zero as possible/ within the £40K annual allowance.
    If she has not been doing that for the last few years , then she has missed the boat I am afraid .
  • Dunnsdale
    Dunnsdale Posts: 73 Forumite
    Part of the Furniture 10 Posts Combo Breaker
    Thank you both for the prompt response and advice.Much appreciated.
  • Investing a lump sum won't get HRT into the SIPP just the normal tax relief (normally credited 6-8 weeks later)
    You reclaim the HRT element on self assessment (well at least I did), you put down your gross pension contributions.
    I got a refund into my bank account 6 days after I filed the self assessment (this month)
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