Is this right- calculation of high tax charge Child tax Benefit

[speciall]

Salary is £55k and received CHB for three children - £2550. No contribution to personal pension and 5.45% contribution to Employer's pension. P60 states - income earned £55041 at the bottom of the page and also states tax deducted.
My question is that - do I need to take the pensions contribution out of this figure ?

Self Assessment form states that I cant include employer's pension on this form but only private pension.

Tax calculated is £1280. Is that right?
I thought I can take pension contributions out from the gross salary but looks like I can't.

No you can’t. We discovered this too late (taking it off took us under the threshold, we made the wrong call).

Now paying back the tax and a fine.

Is that not only if you make extra payments to your pension?

You'd pay back about half of the CB on a £55k salary

Presumably you've not paid tax on your employer pension so that's why? Otherwise you get the benefit twice if you deduct it for CB. The tax sounds about right as it's a sliding scale from £50k to £60k I believe

It depends how the contribution is taken - net pay OR relief at source.
Just one of many online explanations www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/tax-relief-and-your-pension

Lots of people here mentioned to increase pension contributions to pay less charge. Apparently its only applicable to private pensions not to employer's pension scheme.

I'm confused by this, I've been told (civil service so employer defined benefit scheme) I can deduct my contributions?

That is incorrect.

The pension contribution either reduces the gross income reported on your P60 OR you get tax relief (basic rate) claimed by the scheme provider and you claim the higher rate relief on your tax return but including the gross amount of the contribution.

Workplace schemes can be either, it depends how they are set up.

@Chasingsquirrels I receive net pay . So pension contribution is made before tax is deducted. That makes sense.

So if you hadn't made the contributions your gross pay (and therefore child benefit charge) would be higher.

It is based on your taxable salary on your P60.

If you are on 55k and paying 5% then your P60 salary ought to be about 50k, assuming your employer is deducting pension before charging tax

Sorry about this, OP, it's a bummer.

The earnings threshold for CB and the process is unfair and ridiculous.

Can you register on the HMRC app? It will tell you your taxable income, this is what your CB level is based on.

Eg my salary is about £53k. I pay my pension through work as salary sacrifice. The app shows me that my estimated annual taxable income is £48k, based on what I've been paid so far this year. I will have paid around £5k into my pension

Marking for later as this job is on my too-hard-to-do list, hopefully this thread can help make sense of it for me 🥴

I need to do this too 😩

Can I ask a related question please? We've never had to do self assessments before but DH's most recent P60 shows £50,637 which we realise means we need to pay back some of the child benefit. I worked out that we would need to repay about £109.

He receives private medical insurance from his employer too, he didn't get a P11D but he has one for the previous year which shows £1338.

We're unclear on whether this is already included in the P60 figure or if we need to report this separately the tax return.

If we report it it's showing that we need to pay £350; if we don't report it it's showing that he is owed a refund of £423. A big difference so we want to make sure we get it right.

(Before anyone criticises, yes we know we should have looked at this sooner but we've had a dreadful few months including a bereavement and major health issues so it didn't enter our heads.)

Thanks.

Was that figure gross or taxable @MusicWithRocksIn?

Taxable

You just can't deduct your pension contributions twice - which makes sense, right?

It's already been deducted for you on your P60 so you can't take the same amount off again.

If you want to get you income under £50k you need to put more into a pension, any pension.

No it’s all pension contributions that you pay. When they are referred to employer pension contributions they mean the pension contribution that the employer makes in addition to your salary. Anything deducted from your salary you can include. The only time it’s different is if you have a salary sacrifice arrangement

You do need to check your p60 though and compare gross and taxable pay. If they are different the taxable figure may have already had pension deducted. It differs depending on pension

The benefits on the p11d are not in the p60 figure, they’ll be added to the figure to calculate the amount due but you put in a diff box on the tax return

Damn, that means we owe them money. I thought that was probably the case but hoped I was wrong. Thanks for answering though!

If you do owe them money, get onto it asap. I'm incredibly pissed off about the fine we are paying- it's not even like I had forgotten that I stashed a few million in a tax haven!

If you had paid a personal contribution of £5000 gross your net contribution would be £4000 plus HR tax relief on the contribution of £5000 you would receive £800 tax rebate. Plus you would have all your child benefit

Might want to double check exactly what is happening with the private medical. Morph is right, in that if a P11d is issued, then that value will not appear on your P60.

However, my private medical benefit moved in the last tax year from being included in a P11d to being treated as taxable in my monthly payroll. And was therefore included on my P60 for the most recent tax year. If this has happened to you, it should show in your monthly payslip.

This may explain why he never got a P11d this year as there was potentially nothing additional to report.