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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

To think company pensions shouldn't be taxed

6 replies

Footloose80 · 07/03/2019 16:07

As a matter of course.
So df was on JSA but is now on receipt of a company pension but is not yet in receipt of her state pension due to recent changes.
Her pension is circa 600 pm. This is her only income.
Aibu to think that she should not be taxed as this is her only income and I believe is below the tax allowance.

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SprogletsMum · 07/03/2019 16:09

If she's below the tax allowance she won't be taxed on it though surely?
I do think people over the tax allowance should be taxed on their company pension though because its money they have earned and not paid tax on.

Footloose80 · 07/03/2019 16:12

I just looked it up and yes it appears that she shouldn't be taxed. She was under the impression that it was taxable and indeed she has paid tax. Hopefully she will get a tax refund.
Thank you

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Footloose80 · 07/03/2019 16:13

My thoughts exactly sproglets

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noego · 07/03/2019 16:15

She won't be taxed on £600/ month. The tax allowance for 18/19 is £12,500.
It is only when earnings exceed £12,500 will they be liable for tax @ the 20% rate. This will include pension as it is classed as earnings.

SweetSummerchild · 07/03/2019 16:28

She has probably been put on an emergency tax code. She needs to contact her pension provider and get them to apply the correct tax code.

The same thing happened to me when I first received my pension. You can ask for a refund from HMRC, otherwise they will send a cheque after the end of the next tax year. I’ve just received the one for my overpaid tax in 2017/2018.

Footloose80 · 07/03/2019 17:02

Thank you sweet I will let her know.

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