Pensions

Question 1

Pension Schemes

How is a Flexi-Access Drawdown Taken?

Answer 1

Up to 25% of a Pension Fund Can be Withdrawn Tax-free.

The Balance Reinvested by The Pension Provider.

Question 2

Pension Schemes

How is Income Taxed Under a Flexi-Access Drawdown?

Answer 2

At The Taxpayer’s Marginal Rate of Tax.

When Required; To Utilise The Basic Rate Band.

Question 3

Pension Schemes

The Maximum Contribution to a Pension Fund Attracting Relief is The Higher of:

Answer 3

• 100% of ‘Relevant Earnings’; or
• £3,600

Limited to £60,000.

Question 4

Pension Schemes

‘Relevant Earnings’ Includes Income Received From:

Answer 4

• Employment;
• Trading; and
• Furnished Holiday Lets.

Question 5

Pension Schemes

What is Relief at Source Given on?

Answer 5

Personal Pension Contributions.

Question 6

Pension Schemes

What Was The Annual Allowance up Until 2023/24?

Answer 6

£40,000.

Question 7

Pension Schemes

How is The Annual Allowance Increased?

Answer 7

From Any Unused Allowance in The Previous 3 Tax Years.

(Current Years in Priority)

Question 8

Pension Schemes

When Pension Input is Greater Than The Available Annual Allowance:

Answer 8

The Excess is Charged at The Individual’s Marginal Rate of Tax.

Question 9

Pension Schemes

How is ‘Adjusted’ Income Calculated?

Answer 9

Net Income
Plus: Occupational Pension Contributions

Question 10

Pension Schemes

How is ‘Threshold’ Income Calculated?

Answer 10

Net Income (After Net Pay Arrangements)
Less: Personal Pension Contributions

Question 11

Pension Schemes

Are Employer Contributions Taxable?

Answer 11

No.

A Tax-Free Benefit.