The EYU only deals with number differences and I only need to change the directors status - to get him a qualifying year for his pension. This is where it all goes wrong. Good to know I cant submit FPS's for that year though. I will stop trying. Thats one part of the problem solved so thanks very much.
Thanks so much. There is no p60 or p45 as all tax free and not reportable.
Just to check that the 25% pension lump sum will not effect the clients tax on their other income received in the tax year. It says it does not affect their personal allowance but does that mean it does not affect the tax bands too?
The draw down was 100k so they are well in the higher rate tax bracket whereas on the self assessment only the basic rate tax is being applied.
Think I am possibly making it more confusing than it needs to be :/
Hello. Thanks for responding :) Its from a non state pension.
Below (from HMRC site) is where I am getting the notion from that it effects my clients tax bands.
Lump sums from your pension
You can usually take up to 25% of the amount built up in any pension as a tax-free lump sum. The tax-free lump sum doesn’t affect your Personal Allowance.
You might have to pay Income Tax at a higher rate if you take a large amount from your pension. You could also owe extra tax at the end of the tax year.
My answers
Thank you Julie for your kind comments.
Regards
Leigh
Thanks Jason
Nice concise reply which is what I was looking for
best
Leigh
Brilliant, thanks.
The EYU only deals with number differences and I only need to change the directors status - to get him a qualifying year for his pension. This is where it all goes wrong. Good to know I cant submit FPS's for that year though. I will stop trying. Thats one part of the problem solved so thanks very much.
Thank you thestudyman. That's cleared that up.
Thank you DJKL for pointing out potential issues that could arise. Much appreciated.
Very detailed response Jason. Thank you so much for taking the time to respond and being so clear.
Thanks so much. There is no p60 or p45 as all tax free and not reportable.
Just to check that the 25% pension lump sum will not effect the clients tax on their other income received in the tax year. It says it does not affect their personal allowance but does that mean it does not affect the tax bands too?
The draw down was 100k so they are well in the higher rate tax bracket whereas on the self assessment only the basic rate tax is being applied.
Think I am possibly making it more confusing than it needs to be :/
Hello. Thanks for responding :) Its from a non state pension.
Below (from HMRC site) is where I am getting the notion from that it effects my clients tax bands.
Lump sums from your pension
You can usually take up to 25% of the amount built up in any pension as a tax-free lump sum. The tax-free lump sum doesn’t affect your Personal Allowance.
You might have to pay Income Tax at a higher rate if you take a large amount from your pension. You could also owe extra tax at the end of the tax year.
Its okay I have worked it out now. Thanks
Sorry, I meant SA100!