Working from home - tax relief

7Phil

Scrounger said:

Seems rather harsh on the low earners 

Scrounger

But the whole point of tax relief is that you pay less tax. If you pay zero tax then you will still pay zero tax. There is nothing to give back.

Upsidedownandaround

Maybe we could increase tax to pay for sending cheques to people for tax relief on tax they don't pay.

Scrounger

I get tax relief on my pension contributions for tax I don't pay.

https://www.which.co.uk/money/pensions-and-retirement/personal-pensions/contributing-to-a-private-pension-explained/tax-relief-on-pension-contributions-explained-a27f53z7qg3f#headline_6

This is worth up to £2,514 per annum courtesy of the taxpayer!

So not as preposterous an idea as it may seem. 

Scrounger

 

sheramber

Scrounger said:

I get tax relief on my pension contributions for tax I don't pay.

https://www.which.co.uk/money/pensions-and-retirement/personal-pensions/contributing-to-a-private-pension-explained/tax-relief-on-pension-contributions-explained-a27f53z7qg3f#headline_6

This is worth up to £2,514 per annum courtesy of the taxpayer!

So not as preposterous an idea as it may seem. 

Scrounger

 

But you don't get the  money, it goes into your pension pot.

That is to encourage you to save for your old age to save you claiming benefits from the Government. 

Scrounger

sheramber said:

Scrounger said:

I get tax relief on my pension contributions for tax I don't pay.

https://www.which.co.uk/money/pensions-and-retirement/personal-pensions/contributing-to-a-private-pension-explained/tax-relief-on-pension-contributions-explained-a27f53z7qg3f#headline_6

This is worth up to £2,514 per annum courtesy of the taxpayer!

So not as preposterous an idea as it may seem. 

Scrounger

But you don't get the  money, it goes into your pension pot. 

I do get the money because I'm over 55.  So far I've taken 4 x TFLS using drawdown and recycled the cash back in. 

This year I'll be taking 2 small pots keeping just below the PA.

sheramber said:

That is to encourage you to save for your old age to save you claiming benefits from the Government.

Government pension at 60 and full state pension at 67 (so won't need any further benefits).

Its all down to meticulous planning and good luck.   


Scrounger

Jeremy535897

Scrounger said:

sheramber said:

Scrounger said:

I get tax relief on my pension contributions for tax I don't pay.

https://www.which.co.uk/money/pensions-and-retirement/personal-pensions/contributing-to-a-private-pension-explained/tax-relief-on-pension-contributions-explained-a27f53z7qg3f#headline_6

This is worth up to £2,514 per annum courtesy of the taxpayer!

So not as preposterous an idea as it may seem. 

Scrounger

But you don't get the  money, it goes into your pension pot. 

I do get the money because I'm over 55.  So far I've taken 4 x TFLS using drawdown and recycled the cash back in. 

This year I'll be taking 2 small pots keeping just below the PA.

sheramber said:

That is to encourage you to save for your old age to save you claiming benefits from the Government.

Government pension at 60 and full state pension at 67 (so won't need any further benefits).

Its all down to meticulous planning and good luck.   


Scrounger

This is probably the only exception to the general rule that you can't get tax relief and spend it when you don't actually pay tax. The general rule is that if you don't pay tax, you can't claim tax relief.

I am surprised the government permits what is to all intents and purposes a circular series of transactions with no purpose other than the avoidance of tax. I suspect that if they decided to fight the battle, they would win. What worries me more is that they may use it as an excuse to legislate the removal of tax free lump sums altogether.

Scrounger

Jeremy535897 said:

Scrounger said:

sheramber said:

Scrounger said:

I get tax relief on my pension contributions for tax I don't pay.

https://www.which.co.uk/money/pensions-and-retirement/personal-pensions/contributing-to-a-private-pension-explained/tax-relief-on-pension-contributions-explained-a27f53z7qg3f#headline_6

This is worth up to £2,514 per annum courtesy of the taxpayer!

So not as preposterous an idea as it may seem. 

Scrounger

But you don't get the  money, it goes into your pension pot. 

I do get the money because I'm over 55.  So far I've taken 4 x TFLS using drawdown and recycled the cash back in. 

This year I'll be taking 2 small pots keeping just below the PA.

sheramber said:

That is to encourage you to save for your old age to save you claiming benefits from the Government.

Government pension at 60 and full state pension at 67 (so won't need any further benefits).

Its all down to meticulous planning and good luck.   


Scrounger

This is probably the only exception to the general rule that you can't get tax relief and spend it when you don't actually pay tax. The general rule is that if you don't pay tax, you can't claim tax relief.

What worries me more is that they may use it as an excuse to legislate the removal of tax free lump sums altogether.

If  they did that then nobody would pay into pensions! 


Scrounger

Jeremy535897

Auto enrolment is a much more effective way of getting people to pay into pensions than a tax free lump sum.

Scrounger

Interesting concept.

Clearly you know your subject and are well informed; you're not Rishi Sunak are you? 


Scrounger

Jeremy535897

Scrounger said:

Interesting concept.

Clearly you know your subject and are well informed; you're not Rishi Sunak are you? 


Scrounger

I wasn't the last time I looked in the mirror.