Civil Service spouse pension

Northstar2

Hello again all!

I have been given an amount of back pay for the spouse pension I was not paid since August 2019. 

Is £2632 a year right?

Is it right that it has income tax and will have a gross and net? From amount of £7k it just went to £5k?

Appreciate your advice.

Kind regards

jc

DE_612183

Depends on the other income you have for those periods.

Don't quite understand the values have written - was the Gross £7k and the net £5k?

If so what is the £2632?

What other income do you have?

Marcon

Northstar2 said:

Hello again all!

I have been given an amount of back pay for the spouse pension I was not paid since August 2019. 

Is £2632 a year right?

Is it right that it has income tax and will have a gross and net? From amount of £7k it just went to £5k?

Appreciate your advice.

Kind regards

jc

Nobody here could confirm that figure when they've got no idea what your late spouse's pension was/would have been. Do you have any reason to think it is incorrect? If so, the only people who could answer your question are those administering the scheme.

It will be added to your other (potentially taxable) income and you'll pay tax at your marginal rate.

Marcon

Marcon said:

Northstar2 said:

Hello again all!

I have been given an amount of back pay for the spouse pension I was not paid since August 2019. 

Is £2632 a year right?

Is it right that it has income tax and will have a gross and net? From amount of £7k it just went to £5k?

Appreciate your advice.

Kind regards

jc

Nobody here could confirm that figure when they've got no idea what your late spouse's pension was/would have been. Do you have any reason to think it is incorrect? If so, the only people who could answer your question are those administering the scheme.

It will be added to your other (potentially taxable) income and you'll pay tax at your marginal rate.

Edit - just seen your previous post https://forums.moneysavingexpert.com/discussion/6506582/dependant-pension-civil-service-pension#latest 

It would be really helpful if you kept your questions on one thread to ensure those trying to answer have the necessary background information - repeating everything will only cause you distress. It isn't possible to answer you question from the limited background, so I'm afraid really is a case of going back to the scheme administrators if you have concerns.

Northstar2

Marcon said:

Marcon said:

Northstar2 said:

Hello again all!

I have been given an amount of back pay for the spouse pension I was not paid since August 2019. 

Is £2632 a year right?

Is it right that it has income tax and will have a gross and net? From amount of £7k it just went to £5k?

Appreciate your advice.

Kind regards

jc

Nobody here could confirm that figure when they've got no idea what your late spouse's pension was/would have been. Do you have any reason to think it is incorrect? If so, the only people who could answer your question are those administering the scheme.

It will be added to your other (potentially taxable) income and you'll pay tax at your marginal rate.

Edit - just seen your previous post https://forums.moneysavingexpert.com/discussion/6506582/dependant-pension-civil-service-pension#latest 

It would be really helpful if you kept your questions on one thread to ensure those trying to answer have the necessary background information - repeating everything will only cause you distress. It isn't possible to answer you question from the limited background, so I'm afraid really is a case of going back to the scheme administrators if you have concerns.

Hi Marcon. Sorry to annoy you. It is not that I want to open another discussion, but there is an error of me replying to the thread on my mobile. Now I tried on my laptop to see if it works.

So I was supposed to have back payment from Civil Service pensions of £12,861.41. But I was taxed £4,166.10. When I asked them what is their computation, their reply is this:

"I can confirm that you were due arrears of £12,861.41 (gross), the tax code in operation at the time was 1257L on a Week 1 Month 1 basis.

The tax free allowance for this payment is calculated as £1,048.25 (£12,579.00 / 12), the remaining amount £11,813.00 (£12,861.41 - £1,048.25) was taxed based on 20%, 40% and 45% as the amount exceeded HM Revenue and Customs (HMRC) tax boundaries.

Tax is paid on the amount of taxable income remaining after the Personal Allowance has been deducted.

Basic rate 20% up to £37,700.00
Higher rate 40% £37,701.00 to £125,140.00
Additional rate 45% Over £125,141.00

The first £3,141.67 is tax based on 20%, £3,141.00 x 20% = £628.20.
£7,286.67 is tax based on 40%, £7,286.00 x 40% = £2,914.40
£1,384.66 is tax based on 45%, £1,384.00 x 45% = £622.80
Please note, HMRC tax using whole pounds.

£628.20 + £2,914.40 + £622.80 = £4,165.40* "

Even if I get the full amount on top of my salary, I do not think I fall on the higher rate if less the tax free pay (£12,750). I do not understand why they got this computation.

Any ideas is highly appreciated. Thank you all for your patience.

Marcon

Northstar2 said:

Marcon said:

Marcon said:

Northstar2 said:

Hello again all!

I have been given an amount of back pay for the spouse pension I was not paid since August 2019. 

Is £2632 a year right?

Is it right that it has income tax and will have a gross and net? From amount of £7k it just went to £5k?

Appreciate your advice.

Kind regards

jc

Nobody here could confirm that figure when they've got no idea what your late spouse's pension was/would have been. Do you have any reason to think it is incorrect? If so, the only people who could answer your question are those administering the scheme.

It will be added to your other (potentially taxable) income and you'll pay tax at your marginal rate.

Edit - just seen your previous post https://forums.moneysavingexpert.com/discussion/6506582/dependant-pension-civil-service-pension#latest 

It would be really helpful if you kept your questions on one thread to ensure those trying to answer have the necessary background information - repeating everything will only cause you distress. It isn't possible to answer you question from the limited background, so I'm afraid really is a case of going back to the scheme administrators if you have concerns.

Hi Marcon. Sorry to annoy you. It is not that I want to open another discussion, but there is an error of me replying to the thread on my mobile. Now I tried on my laptop to see if it works.

So I was supposed to have back payment from Civil Service pensions of £12,861.41. But I was taxed £4,166.10. When I asked them what is their computation, their reply is this:

"I can confirm that you were due arrears of £12,861.41 (gross), the tax code in operation at the time was 1257L on a Week 1 Month 1 basis.

The tax free allowance for this payment is calculated as £1,048.25 (£12,579.00 / 12), the remaining amount £11,813.00 (£12,861.41 - £1,048.25) was taxed based on 20%, 40% and 45% as the amount exceeded HM Revenue and Customs (HMRC) tax boundaries.

Tax is paid on the amount of taxable income remaining after the Personal Allowance has been deducted.

Basic rate 20% up to £37,700.00
Higher rate 40% £37,701.00 to £125,140.00
Additional rate 45% Over £125,141.00

The first £3,141.67 is tax based on 20%, £3,141.00 x 20% = £628.20.
£7,286.67 is tax based on 40%, £7,286.00 x 40% = £2,914.40
£1,384.66 is tax based on 45%, £1,384.00 x 45% = £622.80
Please note, HMRC tax using whole pounds.

£628.20 + £2,914.40 + £622.80 = £4,165.40* "

Even if I get the full amount on top of my salary, I do not think I fall on the higher rate if less the tax free pay (£12,750). I do not understand why they got this computation.

Any ideas is highly appreciated. Thank you all for your patience.

Not annoyed at all - just anxious not to make you repeat things at a time when you are particularly distressed.

I think the answer is in the Week 1 Month 1 basis. With this tax code, you'll receive just one month's worth of personal allowance - in this case £1,048.25. The rest of the payment is based on that wonderful HMRC assumption that you'll continue to 'earn' the same amount month in, month out...

The good news is that you'll get overpaid tax back, either through self assessment (if you do it); through the Civil Service pensioner payroll; or you can reclaim https://www.gov.uk/claim-tax-refund