Widows Or Divorced Women

Widows or divorced women who have remarried over the age of sixty should note that they can set their retirement pension paid on their late husband's contributions against their wife's earned income tax allowance.

If you are self employed, the income that counts for tax is not the current year's income .

People registered as blind receive an extra tax allowance of £980.

Income from your company pension is taxable. Normally it is taxed at source before you receive it and the Inland Revenue give the pension payer a tax code for you so that they can calculate the tax due. You will be sent a copy of the notice of coding which shows how the tax code is calculated.

The tax code is worked out as follows.

Your tax allowances are the amount of money you can have each year without paying any tax. Your DWP retirement pension is taxable, so the Revenue deduct the amount of that from your allowances to leave the amount of income you can have before you pay tax. For example, your age allowance may be £6,180 and your retirement pension £88 a week or £8,888 a year. £6,180 minus £8,888 equals £898. That means you can have £898 a year on top of your retirement pension without paying tax.

The figure is converted to a tax code by knocking off the last number, making 89. The code is then used to calculate the tax due on the pension you get from your job.

All it means is that you pay tax on the amount above the £890 that remains from your allowances.

This website will take some of the mystery out of these questions and provide answers to many of them. But please remember this website is for informational purposes only and does not constitute professional financial advice.




For more information on - Partial Age Allowance

or Tax On Foreign Pensions

Partial Age Allowance

/retirement/pensions/income/advice/partial-age-allowance.php... see: Partial Age Allowance