100k taxable threshold and company benefits

MPinneye

Hi,

I want to cap my taxable gross income for the next tax year (25/26) to 100k to become more tax efficient. 

With overtime my income is approx. 120k so I will be contributing more to my salary sacrifice work place pension to drop me just below 100k. I have company benefits (car and private medical insurance) worth £5531/year and HMRC have taken this into account and have adjusted my tax code to 703T.

My question is; can my gross salary be up to 100k or does it have to be up to £94,469?

In other words, do I have to consider my benefits as taxable income when trying to cap at 100k even though it has been applied to my tax code already?


Thank you in advance for help/clarification on this.

Dazed_and_C0nfused

MPinneye said:

Hi,

I want to cap my taxable gross income for the next tax year (25/26) to 100k to become more tax efficient. 

With overtime my income is approx. 120k so I will be contributing more to my salary sacrifice work place pension to drop me just below 100k. I have company benefits (car and private medical insurance) worth £5531/year and HMRC have taken this into account and have adjusted my tax code to 703T.

My question is; can my gross salary be up to 100k or does it have to be up to £94,469?

In other words, do I have to consider my benefits as taxable income when trying to cap at 100k even though it has been applied to my tax code already?

Thank you in advance for help/clarification on this.

Company cars and medical insurance are extra sources of taxable income so need to taken into account.  And what is in your tax code is only ever an estimate, it's the actual benefits for 2025-26 which are important.

Your Personal Allowance is based on adjusted net income which includes all taxable income, even interest and dividends which have been taxed at 0%.

Remember you cannot deduct employer pension contributions such as those resulting from salary sacrifice.  They have already been taken into account when calculating your taxable income.

Grumpy_chap

MPinneye said:

do I have to consider my benefits as taxable income ?
.

Yes.

Don't forget to also consider any other sources of income - they may be small in comparison to your salary, but all still count.  Savings interest, dividends etc.