6 replies to this topic

[brad-the-bear]

my dad got a letter today from the government about his pension

1 letter was for his state pension

it reads:

Your personal allowance £8105

state pension/state benefits -£6384

a tax free amount of £1721

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2nd letter was about his PRIVATE pension

it reads:

Your personal allowance £8105

state pension/state benefits -£9888

tax is due on -£1783

it means that because my dad is inclined to his pension that he has worked to for 50 years he now owes the government more money!!! he appealed but was declined.

is there anything we can do? any ideas would be greatly appreciated

brad.

[donjarr]

Hi m8

My dad got the same thing a year or so back and nothing you can do, but come the following tax year he got a letter and cheque saying he had overpaid, and it was the same amount they had said he owed in tax, and just seems half the time they don't know what they are doing.

It also seems if you worked your whole life and paid in for it, then in short you still get screwed when you retire, and worst of all immigrants who have never paid a penny into the country can claim benefit and pensions which doesn't seem right to me.

I go to the post office several times a week to post stuff and see this little old guy who must be in his 80s who just gets his state pension and nothing more (£100 or so pounds). He worked from the age of 15 and paid in his whole life and just gets the basic amount, but I also see in there a thai or something like that guy, whose only word of English is 'all' (i found this out because when he gets to the counter just waves his card at the lady there and says 'all') and gets £426.47 a week. If you ask me there is something seriously wrong with this country.

[brad-the-bear]

hi pal,
hopefully he gets a cheque too but its a shame and a bit of a pis$ take, that they are getting away with this and it seems that there is nothing we can do about it.

[twink]

So wrong.

[MiniLuke]

What are you on about?

All pension income has always been taxable.

The contributions go in tax free (gross) and tax is due on the income less personal allowances.

Your title is a bit strong IMO. Also, what exactly has he appealed against?

[Black.Ghost]

That doesn't make any sense to me whatsoever. If he has a private and state pension, the total, according to your figures, is 6384 + 9888 = ~15k, so tax would be whatever % of 15k-8k, surely?

The way it has been described looks confusing to me.

Tax on a state pension, quite frankly, is pointless. I can understand on a private pension as the money is usually taken from source and before tax is taken (I believe). Plus the employer will contribute to it as well to bump it up which obviously wouldn't have been taxed.

I also agree about the point of the little old man and the Thai guy above. Ridiculous.

[firstforward]

I read it this: his tax free benefit is £8105. He receives a state pension of £6384, take away £6384 from £8105 that leaves £1721. This means he can earn a further 1721 BEFORE he starts to pay any tax. So he earned a further £3,504 (Private Pension) (9888-6384 = 3504 ) . But he has £1721 of his allowance still available to be set against further income and that is £3504 - £1721 = £1783. so he will have to pay tax on the amount of £1783 at whatever they charge now, is it 10% or what I don't know?

Just to add it is my understanding that should be collected in next years monthly/weekly payments, IF it is 10% of 1783 that will be £3.43 a week deducted (178.30 divided by 52).

Edited by firstforward, 17 September 2012 - 08:29 AM.