£50k + earnings and child benefit / increase pension

kenzie123

I am soon to earn just under £51k and currently receive a child benefit - I was told by increasing my pension payments I can still receive the child benefit - is this correct/ allowed?
thanks

jimi_man

Yes that's correct. HMRC work on 'adjusted net income' so any payments to pension, private of work, will count.

Also be aware that with your £51k, you may already pay pension payments anyway so you might be under £50k as it is so you may not need to do anything.

MX5huggy

Yes https://adviser.royallondon.com/technical-central/pensions/state-benefits-pension-manuals/child-benefit-avoiding-the-tax-charge/

as said if your gross salary is £51000 the minimum 5% pension contribution of £2550 would get you under £50000. 

kenzie123

jimi_man said:

Yes that's correct. HMRC work on 'adjusted net income' so any payments to pension, private of work, will count.

Also be aware that with your £51k, you may already pay pension payments anyway so you might be under £50k as it is so you may not need to do anything.

thanks so much - I am thinking I might not need to do anything...

do you know how I'd work this out? I've not got a pay rise yet so on less than £50k at the moment, paying in around 3.5% into my pension.

QrizB

kenzie123 said:

jimi_man said:

Yes that's correct. HMRC work on 'adjusted net income' so any payments to pension, private of work, will count.

Also be aware that with your £51k, you may already pay pension payments anyway so you might be under £50k as it is so you may not need to do anything.

thanks so much - I am thinking I might not need to do anything...

do you know how I'd work this out? I've not got a pay rise yet so on less than £50k at the moment, paying in around 3.5% into my pension.

If you want to know how much you can earn while paying 3.5% into a pension and still have less than £50k left, the calculation is £50000 x 100 / (100 - 3.5) which makes £51813 and some pence.

Dazed_and_C0nfused

Although HICBC is only charged once your adjusted net income reaches £50,100 so if you have no other taxable income of any sort whatsoever you could get up to £51,917 with a 3.5% pension contribution.

Assuming the 3.5% is paid using the net pay method or is the gross amount of a relief at source contribution.

Albermarle

 I've not got a pay rise yet so on less than £50k at the moment, paying in around 3.5% into my pension.

Regardless of the child benefit/40 % taxpayer issue, 3,5% is a a small amount to pay into your pension. Unless you are only maybe in your Twenties and/or your employer is very generous and paying a much higher %.