Higher rate tax payer - advice

E11btt

I am in the £110k earning bracket so higher tax payer. I now also need to submit annual self assessment return.

my question is two fold:

1. besides pension, how else can I maximise tax relief? I suppose it’s all done through my annual return process?

2. I get an annual bonus of 22% which is very heavily taxed, is there anything I can do to get back some of that tax payment?

Dazed_and_C0nfused

1.  Charitable payments under the Gift Aid scheme increases the amount of your basic rate band (more 20% tax less 40%) and they also reduce your Adjusted Net Income (which is what you'd Personal Allowance is based on).

2.  Two popular options are to sacrifice it into your pension i.e. you don't have the £22k to pay tax or NI on in the first place, instead your employer pays £22k into your pension fund. 

Or make larger pension contributions yourself.  For example if you paid in £20k gross that would be £16k you hand over plus £4k basic rate tax relief added by the pension company.  Your basic rate band is increases by £20k (the gross contribution) and your adjusted net income is reduced by £20k.  So very tax efficient.


NB.  There is no basic rate pension tax relief added with employer pension contributions

lisyloo

The main one is pension. Up to £40k gross although you can use up to 3 previous tax years allowances. That is well worth looking into.

there are also enterprise investment schemes (eis) or venture capital trusts (vct) but those are not risk free.

so pension is the main one and if you can afford take a look at carry forward for using previous years allowances.
youll have to move quick if you want to make payments before 5/4/22

i did some pension stuff recently and the tax, advice and anti-money laundering checks took a while.
your employer will want notice if you’re doing it that way.
salary sacrifice is best if it’s available as you save NI also.