Hi all,
Grateful for some advice/views. I pay tax via self assessment. For next year only, due to maturity dates of bonds i have held for years, my untaxed income will shoot up to £122,000 instead of the usual £55,000. I understand that without any mitigating action this means I would lose my personal allowance and in effect be subjected to 60% tax for my income over 100,000!
My questions are:
1) Is there a way to maybe pay into a SIPP or something similar to drop back under 100,000 and keep my personal allowance?
2) Are there any other consequences of dipping over 100,000 such as changes in tax bracket/greater HMRC scrutiny/tax code issues? You see I have an option of deferring about £30,000 of the income to the FY after (dropping me to about 90k) but it will cost me about £5000 in penalty fees to do so. Would that be preferable to the SIPP route (if that is indeed a route)?
Thank you,
D
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