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Headline

GPs could face huge tax bill as inflation pushes pension pots over annual limits

Comment

In my opinion , some of the terminology in this article is misleading. Check out GOV.UK ; An individual with a Threshold Income of £ 110,000 or less for a tax year - is not subject to the tapered annual charge regardless of the level of their adjusted income for that year . That means that anyone with a threshold income of over £ 110,000 MAY be subject to the annual tax charge .The test is called the Adjusted Income. Add in the increased value of ones pension pot , minus the usual start of year adjustment. If that increase of pension revaluation is more than £ 40,000 - onto of a threshold income of £ 110,000 - it will add up to £ 150,000 and will trigger the annual allowance tax charge. So in my opinion , one possible plan for avoiding this latest pension tax problem - is to keep Threshold income below £ 110,000 . That would avoid the problem of this unfair Annual Allowance pension tax charge irrespective of pension pot growth in that tax year.

Posted date

05 Sep 2017

Posted time

11:38am

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