5. Taxable Income Flashcards
1
Q
What is the personal allowance?
A
Tax free income given to individuals.
£12,500 per annum
2
Q
What is the personal allowance restriction?
A
When an individuals adjusted net income exceeds £100,000 the personal allowance is restricted.
3
Q
How do you calculate the personal allowance restriction?
A
1/2 ( Adjusted net income - £100,000 )
4
Q
How do you calculate the adjusted net income?
A
Total income - gift aid payments (gross) - personal pension contributions (gross)
