Pension drawdown taxation and charitable donations

leosayer

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Dazed_and_C0nfused

leosayer said:

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Is that £3,000 the net or gross amount?

leosayer

Dazed_and_C0nfused said:

leosayer said:

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Is that £3,000 the net or gross amount?

It's the net amount, paid to the charities from my bank account.

zagfles

Assuming they are gift aid donations then £3000 donation would be £3750 gross and would increase your basic rate band by £3750. 

Dazed_and_C0nfused

leosayer said:

Dazed_and_C0nfused said:

leosayer said:

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Is that £3,000 the net or gross amount?

It's the net amount, paid to the charities from my bank account.

Why do you want to limit the amount taken from your SIPP then?

Or do you have other taxable income not previously disclosed?

leosayer

Dazed_and_C0nfused said:

leosayer said:

Dazed_and_C0nfused said:

leosayer said:

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Is that £3,000 the net or gross amount?

It's the net amount, paid to the charities from my bank account.

Why do you want to limit the amount taken from your SIPP then?

Or do you have other taxable income not previously disclosed?

Not sure I understand what you are asking. I want to limit what I take from my SIPP to avoid paying higher rate tax.

My only income this year year will be from my SIPP.

Dazed_and_C0nfused

leosayer said:

Dazed_and_C0nfused said:

leosayer said:

Dazed_and_C0nfused said:

leosayer said:

I plan to take make my first SIPP drawdown later this year and will take as much income as I can at the basic rate of tax ie. £50,270 income plus the £16,756 lump sum.

If I normally make £3,000 charitable donations each year then could I take that amount as additional income from my SIPP, making a total drawdown of £53,270 income plus then £17,756 lump sum and then claim back the higher rate tax on the £3,000 from HMRC?

Is that £3,000 the net or gross amount?

It's the net amount, paid to the charities from my bank account.

Why do you want to limit the amount taken from your SIPP then?

Or do you have other taxable income not previously disclosed?

Not sure I understand what you are asking. I want to limit what I take from my SIPP to avoid paying higher rate tax.

My only income this year year will be from my SIPP.

Well with gross Gift Aid donations of £3,750 your basic rate band will be extended from £37,700 to £41,450.

With Personal Allowance added on that takes you to £54,020 before higher rate starts to apply.

The above assumes you aren't Scottish resident and the charity donations qualify under the Gift Aid scheme.

leosayer

Thanks all