Postby Dave12335 » Fri Mar 29, 2019 9:21 pm
Hi tax friends, the P800 has arrived. The following extracts / points are relevant :
1. HMRC agrees with both the income figures and charitable donations
2. There is no problem with the Personal Savings Allowance
3. The extended basic rate band has been calculated as £44,648. I think this is the basic rate band £33,500 plus donations £5,718 grossed up plus net pension contributions £4,000 NOT grossed up
4. However I had understood the basic rate band should be increased by pension contributions GROSSED UP
5. As a result of 3. the P800 shows some income taxed at the higher rate ( ie the lack of just busts the basic rate limit )
6. The blurb says “The amount you pay at the higher rate has been reduced by the amount of your contributions” - a bit vague on 3. vs 4.
Can anyone clarify whether 3. or 4. is correct ? Ie how do you increase the basic rate band please ? I’d be surprised if the software wasn’t right ?!