question on extended basic rate

Fiorellino Registered Posts: 82 💫 🐯 💫
June 2008 past paper exam section 1

"Joined a private pension scheme on the 1st Jan 08 and pays £195 net per month commencing 1 Jan 08"

My question is:
when calculating the net income tax payable why the extended basic rate is not applied to the £750 gross figure pension contribution?

Any advice?


  • swampy19
    swampy19 Registered Posts: 10 Regular contributor ⭐ 😼 ⭐
    Probably because he is still paying basic rate tax. It's the higher rate tax payer that can extend the tax band width.

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