Higher rate tax (just) - Make AVCs to USS Pension

Lifes_Grand_Plan

Hi everyone,

I'm currently in the USS pension scheme and pay contributions via salary sacrifice. This year i'm likely to tip over into 40% higher rate tax. Gross salary for the year is likely to be £50,895 after pension and a current additional voluntary contribution.

Is it worth upping my AVCs by £105 a month to keep my gross pay for the year under the £50,270 barrier and save the 40% tax and top my pension up at the same time?

Any cons to that plan or anything to consider?

Dazed_and_C0nfused

Lifes_Grand_Plan said:

Hi everyone,

I'm currently in the USS pension scheme and pay contributions via salary sacrifice. This year i'm likely to tip over into 40% higher rate tax. Gross salary for the year is likely to be £50,895 after pension and a current additional voluntary contribution.

Is it worth upping my AVCs by £105 a month to keep my gross pay for the year under the £50,270 barrier and save the 40% tax and top my pension up at the same time?

Any cons to that plan or anything to consider?

Is there any other taxable income you need t consider?

Avoiding paying 40% tax and 2% NI is a pretty good incentive to go with the extra pension, assuming you can afford the reduction in take home pay.