What am I missing with this?

richallum

CPD system says £0 is the wrong answer. Anyone show me why £2,400 is right?

Jamie_Barnes

I think it's because it is the word "partner", therefore it's a third party pension contribution so not eligible for tax relief.

richallum

That's my thinking. You can't pay gross to a personal pension for a start. The net contribution would be paid to partner's pension and he/she would get basic rate relief added. £0 is the right answer IMO.

LucyG

Doesn't it just mean - for a £1,000 gross pm, then net contribution is £800 so £200 tax relief pm.

£200 x 12 = £2,400

richallum

@LucyG don't disagree with you but the language is all wrong:

Alan can't pay £1,000 gross pm into a personal pension.

"How much tax relief would he get?" - he'd get none. The partner will get £2,400.

Jona

Yep that reads like a CII R0 question.

Strong letter of opinion to the CPD provider is needed.

richallum

It's a CISI professional refresher!

benjaminfabi

That's a bad question. You're right, the answer is £0. But as he can't pay £1,000 gross into her pension I'll assume it's £1,000 going in and she'd get £250pm RAS.

richallum

It's wrong on every level. I'm beginning to doubt he's really called Alan.

benjaminfabi

Also, don't forget that each payment is a transfer of value for IHT purposes and if there aren't any exemptions available each payment is a PET!

richallum

Unless his partner is his wife/husband/civil partner

Jona

"I'm beginning to doubt he's really called Alan"

arongunningham

Tax relief is based on the pension holder's circumstances , isn't it, not the contributors?

richallum

@arongunningham yes

arongunningham

Right, the question is FUBAR