Partial Retirement & Tax

Dazed_and_C0nfused

drummersdale said:

Thanks for the response @Dazed_and_C0nfused

Remember your salary isn't relevant for tax purposes, it's your taxable pay.  With the civil service using a net pay pension contribution system your taxable pay will no doubt be quite a bit less than your salary.

Is this a positive or a negative? 

Give that salary sacrifice doesn't seem to be an option with the civil service it's a good thing.  You get the maximum possible tax relief each payday with no need to ever claim anything else or tell anyone about the pension contributions.

drummersdale

Dazed_and_C0nfused said:

drummersdale said:

Thanks for the response @Dazed_and_C0nfused

Remember your salary isn't relevant for tax purposes, it's your taxable pay.  With the civil service using a net pay pension contribution system your taxable pay will no doubt be quite a bit less than your salary.

Is this a positive or a negative? 

Give that salary sacrifice doesn't seem to be an option with the civil service it's a good thing.  You get the maximum possible tax relief each payday with no need to ever claim anything else or tell anyone about the pension contributions.

Thanks very much @Dazed_and_C0nfused 😀

german_keeper

Don't forget that when it comes to full retirement we are salaried and paid for 365 days of the year. So if you do get your "naughty word" contract and your final working day is a Thursday make sure your last day of service is the following Monday so you get paid for Friday, Saturday, Sunday and Monday, hence my last day of service being 1st August.

I did ask my gaffer if she would approve a change in my contract from Tues, Weds, Thurs to Weds, Thurs, Fri in my last week of service so I could go for 2nd August as last day of service and get an extra day's pay. She was happy enough to give it a go but in the end I just didn't have the brass neck to try. Pretty sure it wouldn't have got HR approval. And of course it's taxpayer's money after all. 

drummersdale

Good point @german_keeper but we are all taxpayers are we not 😀

drummersdale

I saw that The Salary Calculator site has an option for "Two Jobs" treating one as a salary and the other as a pension (so it excludes NI) so hopefully if I have put my numbers in correctly that should give a reasonable idea of monthly "take home pay" - as in salary and pension combined - albeit for 23/24 as opposed to the middle of the tax year when I am looking to partially retire.