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Adjusted net income question
Bluesden
Posts: 4 Newbie
in Cutting tax
Hello.
Hoping someone can provide a little clarity please, I understand the concept of Adjusted net income and how this can be reduced. However, one thing is not clear to me regarding pension payments:
The HMRC website mentions pension payments to a company scheme should be deducted as part of the ANI calculation on a gross basis, but they don't clarify if additional payments (not paid through my payroll) should be deducted as a net or gross amount as part of the calculation.
Hoping someone can provide a little clarity please, I understand the concept of Adjusted net income and how this can be reduced. However, one thing is not clear to me regarding pension payments:
The HMRC website mentions pension payments to a company scheme should be deducted as part of the ANI calculation on a gross basis, but they don't clarify if additional payments (not paid through my payroll) should be deducted as a net or gross amount as part of the calculation.
0
Comments
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Gross amount.
Step 3 - take off pension contributions
If you made a contribution to a pension scheme where your pension provider has already given you tax relief at basic rate, take off the grossed-up amount - what you paid plus the basic rate of tax.
So, for every £1 of pension contribution you made, take £1.25 from your net income0 -
Thanks for the answer, but that's just the issue I'm having... By paying an amount directly to my pension provider outside of any work based salary payment (and therefore relief at source) do I still use the gross amount?
Cheers.0 -
The answer is still Yes!0
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Perfect. Thank you!0
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