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Draw Down Calculations...
DE_612183
Posts: 4,128 Forumite
Can someone check my logic?
Assuming that I already have some income that takes up my Tax Allowance.
If I take £5k ( 25% is tax free - £1250, the balance then is subject to 20% tax, so the £3750 gets reduced to £3000 ), then I actually get £4250 - and if I split this over 12 months that is £354.16.
So the multiplying factor to determine how much I need to draw based on my monthly requirement is:
Monthly Requirement * 14.11765
I understand that if my overall income goes above about 50k then it gets more complicated but I'm only looking for a small amount.
Assuming that I already have some income that takes up my Tax Allowance.
If I take £5k ( 25% is tax free - £1250, the balance then is subject to 20% tax, so the £3750 gets reduced to £3000 ), then I actually get £4250 - and if I split this over 12 months that is £354.16.
So the multiplying factor to determine how much I need to draw based on my monthly requirement is:
Monthly Requirement * 14.11765
I understand that if my overall income goes above about 50k then it gets more complicated but I'm only looking for a small amount.
0
Comments
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Yes, that's probably close enough.The factor is 12/0.85, or (if you'd prefer whole numbers) 240/17.Which is the same as 14.11765, if you round to to five decimal places.N. Hampshire, he/him. Octopus Intelligent Go elec & Tracker gas / Vodafone BB / iD mobile. Ripple Kirk Hill Coop member.Ofgem cap table, Ofgem cap explainer. Economy 7 cap explainer. Gas vs E7 vs peak elec heating costs, Best kettle!
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