Hi All,
I am fortunate enough to earn over £100k through employment, contribute to my group personal pension via relief at source and file a self-assessment tax return each year (to claim the higher-rate tax back). I adjust my pension contributions to offset against my income to ensure my Adjusted Net Income (ANI) is below £100k so my income tax personal allowance is not reduced and it is also a requirement for Tax Free Childcare (ANI<£100k) for which I apply to help pay for my child's education.
Hopefully all the above makes sense and is correct.
Now, I have been made aware by my employer that I could contribute to my pension via salary sacrifice instead and save on NICs. However, are pension salary sacrifice contributions (i.e. employer contributions) included in the ANI calculation? If so (and one cannot offset these contributions against income because they are not taxed) then my ANI would be >£100k and it would not achieve the same result as normal employee contributions.
I have tried searching online for confirmation but have found lots of conflicting information, perhaps the rules changed recently or something, but any help on the above would be most appreciated.
Many thanks!
DT
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