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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15665
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I'm self assessed painter and I earn about £14000 this year,

Resolved Question:

I'm self assessed painter and I earn about £14000 this year, i've also cashed in a pension worth £54000, ive paid £16900 in tax already how much tax will I be deducted come end of year?
Submitted: 8 months ago.
Category: Tax
Expert:  TonyTax replied 8 months ago.
Hi. Was any of the cashed in pension a tax free lump sum?
Customer: replied 8 months ago.
Yes the first £13,532.10 was tax free
Expert:  TonyTax replied 8 months ago.
Thanks. Leave this with me while I draft my answer.
Customer: replied 8 months ago.
Benefit statement was £54,128.40, Tax free £13,532.10, Net amount £23,880.65 less income tax of £16,715.65,.
Also ive paid £670 on account already in December last year.
Expert:  TonyTax replied 8 months ago.
If you make a trading profit of &pound;14,000 for 2015/16, the first &pound;10,600 will be tax free leaving &pound;3,400 taxable at 20% (&pound;680.00). Of the pension payment of &pound;54,128, &pound;13,532 will be tax free so that leaves &pound;40,596 taxable. &pound;28,385 (&pound;31,785 basic rate tax band - &pound;3,400) will be taxed at 20% (&pound;5,677.00) and the balance of &pound;12,211 will be taxed at 40% (&pound;4,884.40). Your total tax liability will be &pound;11,241.40 (&pound;680.00 + &pound;5,677.00 + &pound;4,884.40). As you have paid &pound;17,385.65 (&pound;670.00 + &pound;16,716.65), you are entitled to a tax repayment of &pound;6,144.25. You could make a claim for an-year tax repayment using a P53Z but as we are so close to the end of the tax year on 5 April, if I were you, I'd make the claim via my self-assessment tax return as soon as possible after 5 April 2016. I hope this helps but let me know if you have nay further questions.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15665
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.

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