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Pension taxed at source + self employment
Squoozy
Posts: 162 Forumite
I am due to receive my NHS pension in January when I turn 60. My pension letter says that the pension will be taxed at source. However, I am currently self employed and complete a tax return every year. I presume I will need to declare the pension, but will I then end up paying tax twice on the pension? How do I let the inland revenue know that the pension will already be taxed?
Many thanks
0
Comments
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No you won't be taxed twice.
You don't need to bother with the Inland Revenue, they were abolished 15 years ago
When you come to complete your 2020:21 Self Assessment return you need to include the taxable pension amount received and Amy tax deducted. Those two elements will be taken into account in your Self Assessment calculation.
You will probably find the emergency tax code is used on the first payment so no tax would be deducted unless it exceeds £1,042.
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my NHS pension was taxed at BR and my assorted tax codes were applied to earned income in various ways. It never worked out at the time but when I completed the self assessment the amount I owed them was calculated.
On the form you put all the income and all the tax (from your P60s which appear in May) and it works out how much you owe each other.
PS you can tell how much tax you have paid on the pension by the figures in the bank reference on your statement - they don't have payslips so this is the only way to tell
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