Adjusted net income

[cs0rpc]

Hi there,

I am trying to calculate my adjusted net income to understand if I am eligible for government funded childcare.

My wife earns comfortably beneath the current threshold, but I am borderline. My earnings are broken down between:

1. basic pay
2. bonus
3. income from renting a flat
4. ISA interest

I don't want to provide the specifics, but I would be greatful to anyone who can help with the following questions and assumptions

1. Rental income should actually be rental profit (i.e. less expenses that are tax deductible)
2. Whilst a tax credit is given for mortgage interest, the interest is not deductible in itself from the rental profit?
3. Similarly, any mortgage product or solicitor fees would not be deductable from the rental profit?
4. ISA interest counts towards adjusted net income?
5. Pensions - this is an area I'm unclear on

I sacrifice a percentage of my pay into my pension, which my employer matches.

Does this have any net effect on my calculation?

Thanks!

[D&C]

1. Yes, it is your profit that counts for ANI purposes
2. Correct
3. Don't know enough to answer that but ultimately it is your taxable profit which counts for ANI purposes
4. You seem to have completely and utterly missed the point of ISA's. The interest received is exempt from tax and nothing to do with ANI
5. You cannot deduct salary sacrifice pension contributions as they employer contributions. That is why you don't receive any pension tax relief on them, you haven't paid them. Of course you have less taxable earnings because of the salary sacrifice but you cannot deduct them in your calculations as that would be double counting.