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TonyTax
TonyTax, Tax Consultant
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My brother is 66 years old and is in receipt of state pension.

Customer Question

My brother is 66 years old and is in receipt of state pension. He also receives a small pension from a personal pension fund.
He also receives some disability and carer allowance and part of his rental is covered by the local council. Even taking all this into account. he is only a few hundred pounds above the figure for paying income tax. However, on his personal pension. The government have assessed him to pay 21.5% income tax. My question is should disability benefits be taken into taxable income and even if they are, should the amount of tax. he's paying on the total amount be allowed
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi.

When you say that your brother receives some "carer allowance", am I correct in assuming that gets that because he looks after somebody. Is the disability allowance paid to your brother because he has a disability? Can you tell me what your brother receives from each source please, ie state pension, carer's allowance and disability payment.
Customer: replied 1 year ago.

The disability allowance is paid to my brother. I'm not sure of the exact amount, but I think in total it is around £600 per month, or around £7000 per annum.

He gets no income for looking after someone else.

His personal pension is being Paid net at £354 net. on the total amount so he is paying £74 tax ont full amount £428
.

For looking after somebody else He gets zero allowance Somebody else For looking after He gets zero allowance f somebody else or looking afterzero allowance he gets The disability allowance Is paid into my brother The disability allowance Is paid to my brother

Customer: replied 1 year ago.

The disability allowance is paid to my brother. I'm not sure of the exact amount, but I think in total it is around £600 per month, or around £7000 per annum.

He gets no income for looking after someone else.

His personal pension is being Paid net at £354 net. on the total amount so he is paying £74 tax ont full amount £428
.

Sorry for the typos my computer is playing up.

Expert:  TonyTax replied 1 year ago.
Thanks.

In your question, you mentioned "carer allowance". What did you mean by that if he gets no income to look after anybody else? How much is his state pension?
Customer: replied 1 year ago.

I have to go out now.Please will you respond to my email:

*****@******.***

Expert:  TonyTax replied 1 year ago.

I cannot send responses to personal emails I'm afraid. All I need to know is how much state pension your brother receives and i will be able to answer your question.

I have to go out for about 30 minutes but I will be back.

Customer: replied 1 year ago.

Im not sure but I think it is the basic of £110 or slightly more but not much more.

Expert:  TonyTax replied 1 year ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 1 year ago.
Hi again.

The Disability Living Allowance your brother receives isn't taxable. The current rate of state pension is £113.10 per week which equates to £5,881 annually. Assuming the private pension is £428 per month, that equates to £5,136 annually. His total income is, therefore, £11,017.

If your brother was born after 5 April 1948, he is entitled to a personal allowance of £10,000 which would mean that his taxable income for 2014/15 will be £1,017 (£11,017 - £10,000) on which he would pay tax at 20% (£203.40 annually or £16.95 per month).

Your brother should call the tax office on the number here and ask them to review the tax code being operated against his private pension and to change it while he is on the phone, if necessary. If they say they cannot amend it, he should ask for the reason and you can come back here and tell me.

I hope this helps but let me know if you have any further questions.

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