Offshore bond surrender - tax calc method check...
smith
Member
Hi there,
Just checking my understanding of a calc and I know everyone loves the techy stuff... Hoping I haven't oversimplified it too much...
Client has pension income & dividends
Step 1
Work out the tax on the gain. (as it's offshore, dividends will get moved to last in the calc so will move to HRT)
Step 2
Work out the tax on the entire gain with the gain as the top level of income, i.e. highest marginal rate and in this case after dividends, less 20% tax credit on entire gain (only £500 PSA as HRT)
Step 3
Work out the tax on the top sliced gain with the gain as the top level of income, i.e. highest marginal rate and in this case after dividends, less 20% tax credit on entire slice (only £500 PSA as still HRT)
Take 3 from 2 to get the relief
Take the relief from the figure in 1
Done!
Comments
Maybe
Stick the info in here and behold the tax sums with full top slicing sums
https://www.mandg.com/wealth/adviser-services/tech-matters/tools-and-calculators/tax-relief-modeller
Cheers Les, I'd seen the tool, but not been into it, so not spotted what it could cover.
Handily, gives the same answers as my cobbled together spreadsheet...
Yes, we need to rename it I think - any suggestions?
Nice
Taming Tax Tool