Am I now a lower rate tax payer?

[Heatherbell1978]

I'm a higher rate tax payer based on my earnings. But at the moment, between an electric car payment and large pension contributions coming off my salary as salary sacrifice, I am earning in the lower tax threshold - below £43k as I'm in Scotland.

I also have some money earning interest in savings accounts. We took some equity out of the house which we don't need for a couple of years (yes our ISA allowances are being used). So based on the above can I earn £1000 interest before tax or am I still considered a higher rated payer and so it's £500 before tax?

I'm unclear whether your status as a higher or lower rate later is fluid or fixed in this circumstance?

It is after pension contributions - these come off your gross income to give you taxable income.

But payments made for a company car as still taxable earnings so you can't take those off

I don't know - but I would imagine that HMRC looks over the whole year.

Electric car payment sounds like salary sacrifice so is before tax.

I am pretty sure I was wrong. Sorry. It comes off gross pay. You add on a benefit in kind but this is v low for an electric car.

https://community.hmrc.gov.uk/customerforums/taxcredits/7d834b69-870e-ee11-a81c-002248c5fd92

My EV payments are before tax - it's a salary sacrifice scheme. I do pay BIK but it's very low.