Re: reverse tax


"Roger Mills" <watt.tyler@xxxxxxxxxxxxxx> wrote in message
news:6rv8noF3fm6tU1@xxxxxxxxxxxxxxxxxxxxx
In an earlier contribution to this discussion,
Janice <janicealk@xxxxxxxxxxx> wrote:

Hi I get 2 pensions per month, 1 of £84.62 and the other of £127.02
which are taxed at, I think 20%, as I also work and pay income tax on
my wages of £6 per hour for a 30 hour week

What would be the amounts of £84.62 and £127.02 I would get if I was
no longer liable for income tax on them?

My hours are going to be cut so my wages will be under the threshhold
for paying tax i.e less than my tax code.

Thanks, Janice

Assuming that the figures quoted for the pension are net (after tax), the
gross values would be £105.77 and £158.77 respectively. If these were both
paid gross, you would get a total of £3174 from them in a complete year.

They will, however, only be paid gross if your *total* income - including
what is left of your job - add up to less than the tax allowance. Assuming
you get a standard tax allowance (was about £5400, but has been put up a bit
to compensate for the loss of the 10% rate - can't remember the exact
current figure) you will only be able to earn about £3000 p.a. (compared
with £9000? at present) without still having to pay *some* tax on the
pensions.

Allowance is £6035 or £9030 if over 65.

See: http://www.hm-treasury.gov.uk/prebud_pbr08_press02.htm includes next
year's amounts.

--
Andy




.

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