PTC - extending tax band query
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Can anyone confirm whether unearned income, i.e. Dividends, can benefit from extending the tax band?
E.g. When you gross up your private pension you can extend the £33,300 by say £5000. However if your earned income is £37,300 can you use the remaining £1000 of the 22% tax band on unearned income?
I think you can as there a question in Osborne 5.2 but there doesn't appear to be any explanation.
Thanks in advance
E.g. When you gross up your private pension you can extend the £33,300 by say £5000. However if your earned income is £37,300 can you use the remaining £1000 of the 22% tax band on unearned income?
I think you can as there a question in Osborne 5.2 but there doesn't appear to be any explanation.
Thanks in advance
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Re:PTC - extending tax band query
Hi
The one day I dont bring my book to work and its a question I think I can answer...
So with your example, you would go up to the increased basic rate of £38300 with either the General 22% Savings 20% Dividend 10%, whichever one takes you to that new amount. I you have Dividend Income which is within the new Basic rate of £38300 you would apply the Dividend percentage of 10% up to amount and then the 32.5% for anything above.
Hope that makes sense.
Yas
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