Types of way to reduce income before tax

Hi, what are the rates to reduce your income that is eligible for tax?

For example, if one earns £52,000 and they want to get below the 40% tax barrier, other than increasing pension contributions, is there any other way to do this? 

Comments

  • Is reducing your taxable particularly important?

    Only certain types of pension contributions reduce taxable income. 

    Although others can move you from 40% to 20% without reducing your taxable income which most people would be content with.

    You could work fewer hours.  Or get a lower paid job.  Or if you run a business that makes a loss that can sometimes be offset against PAYE income.
  • Grumpy_chap
    Grumpy_chap Posts: 14,459
    First Anniversary First Post Name Dropper Combo Breaker
    Forumite
    If you earn £52k, your current ANI may be below the higher rate threshold once pension contributions are considered.

    You can also make Gift Aid donations.
  • prowla
    prowla Posts: 13,098
    Name Dropper First Anniversary First Post
    Forumite
    Pension contributions are the general one.
    You could contribute to charity, but then you'd be reducing your income!
    Also, check if you have any taxable benefits, as they may bump up your taxable income.
  • Grumpy_chap
    Grumpy_chap Posts: 14,459
    First Anniversary First Post Name Dropper Combo Breaker
    Forumite
    prowla said:
    check if you have any taxable benefits, as they may bump up your taxable income.
    As would savings interest or dividends and such like.
Meet your Ambassadors

Categories

  • All Categories
  • 341.9K Banking & Borrowing
  • 249.7K Reduce Debt & Boost Income
  • 449.2K Spending & Discounts
  • 234K Work, Benefits & Business
  • 606.2K Mortgages, Homes & Bills
  • 172.5K Life & Family
  • 246.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards