Hello,
in my last year (2015) before retirement I want to maximise my AVC payment to get all the tax, I paid at 40%, back.
My last payslip for 2015 says TaxablePay = 60,000, of which, I think,
42,800 taxed at 20%
17,200 taxed at 40%
but I am unsure if this already includes relief for employee pension contrib's (2000 for the year) and monthly AVC contrib's (6000 for the year) I am getting relief for in my statement of allowances.
So, what lump sum do I need to make to get all my remaining 40% tax back? Is it 17,200 or 17,200-(6000+2000)=9,200?
Is it worthwhile going beyond the 40% relief and making a bigger contribution to get relief at
20% as well? It is very possible that if this money is extracted from an ARF some time after retirement,it will be taxed at 40% due to income levels. I think maybe I'd prefer to pay 20% on it now and invest it, rather than invest it tax free in an ARF and pay 40% on it later on extraction. If it's still all invested when I die, what tax will my estate pay on it?
in my last year (2015) before retirement I want to maximise my AVC payment to get all the tax, I paid at 40%, back.
My last payslip for 2015 says TaxablePay = 60,000, of which, I think,
42,800 taxed at 20%
17,200 taxed at 40%
but I am unsure if this already includes relief for employee pension contrib's (2000 for the year) and monthly AVC contrib's (6000 for the year) I am getting relief for in my statement of allowances.
So, what lump sum do I need to make to get all my remaining 40% tax back? Is it 17,200 or 17,200-(6000+2000)=9,200?
Is it worthwhile going beyond the 40% relief and making a bigger contribution to get relief at
20% as well? It is very possible that if this money is extracted from an ARF some time after retirement,it will be taxed at 40% due to income levels. I think maybe I'd prefer to pay 20% on it now and invest it, rather than invest it tax free in an ARF and pay 40% on it later on extraction. If it's still all invested when I die, what tax will my estate pay on it?