High income and exceeding pensions allowances

Shinynewpenny

Any suggestions for reducing taxable income for someone who earns £130k+, but already exceeding annual £60k pension allowance (due to high employer contributions?) Would junior SSIP payments or salary sacrifice EV scheme be options?

Dazed_and_C0nfused

Shinynewpenny said:

Any suggestions for reducing taxable income for someone who earns £130k+, but already exceeding annual £60k pension allowance (due to high employer contributions?) Would junior SSIP payments or salary sacrifice EV scheme be options?

No idea what a junior SSIP is but if it involves paying into an investment for someone else I can't see how that could help you.

By it's very nature salary sacrifice reduces your taxable income.  But don't forget if you use it to procure a company car then the car benefit (and fuel benefit is applicable) will be additional taxable income you need to factor in.

Reducing your hours is usually an easy way to reduce your taxable income.  

Shinynewpenny

Thank you. This is for a teacher, so can’t change hours. Not convinced EV is an option, just trying to think of all options really. Appreciate the reply 

Dazed_and_C0nfused

Shinynewpenny said:

Thank you. This is for a teacher, so can’t change hours. Not convinced EV is an option, just trying to think of all options really. Appreciate the reply 

Sometimes people think they need to reduce their taxable income when what they really mean is they want to reduce their adjusted net income.

This is a common misconception when it comes to the tapered Personal Allowance (and High Income Child Benefit Charge).

If reducing taxable income isn't really that important but reducing ANI is then the other common way to do it (if relief at source pension contributions aren't possible) is Gift Aid donations.

Shinynewpenny

Sorry, yes- adjusted net income 99,999 was the goal I think

Dazed_and_C0nfused

Shinynewpenny said:

Sorry, yes- adjusted net income 99,999 was the goal I think

In that case taxable income is only part of the equation.  An important part but other things can help.  Normally relief at source pension contributions and Gift Aid donations.