Cutting off 60% tax trap

CityLatina

Thank you, that's helpful. I feel a bit ashamed complained about taxes when reflecting I am very privileged to have received £58k of free money.

My employer only does net repayment pension, they do not do RAS. I mentioned RAS if I was to take a SIPP separately from my employers pension scheme. 

My basic salary in 2022-2023 was £105k therefore I still availed of £8860 of tax allowance. But in 2023-2024 they paid two bonuses within the same tax year (one I cashed this next I will sacrifice).

Ok, during 2024 I will have to face the full blow of tax over £100k - I think am left with no other option.

How would you suggest me to avoid reaching £101K in future? I am fine to sacrifice the annual bonuses onto either the employer pension or a separate SIPP through also fine to invest the excess of £100k onto pension. 

Much appreciated your suggestions to close off this in my mind please.

Dazed_and_C0nfused

Going forward the simplest (and almost certainly the most tax efficient) option is to increase your regular salary sacrifice amount.

To be honest if you had posted this on the pensions forum you would have had a few comments about £695 being a very small amount to be sacrificing, especially given the tax rates you are paying on the income you don't sacrifice.

Unless you are certain you have no carry forward available it is probably worth understanding how that works and how it can benefit you.

And getting (paid for) professional advice might be worth exploring.