ACCA F6 四川大学工商管理学院 课件Chapter 5.pptVIP

Chapter 5 Pensions 1 Types of pension scheme and membership 2 Contributing to a pension scheme 3 Receiving benefits from pension arrangements 1 Types of pension scheme and membership Individual may make pension provision in different ways More than one pension arrangement If an individual is a member of an occupational pension scheme and also a member of other personal pension scheme, there is a limit on the amount of contributions that the individual can make in a tax year. 2 Contributing to a pension scheme Any individual under the age of 75 can make tax relievable pension contributions in a tax year. The maximum amount of contributions attracting tax relief in a tax year is the higher of : (a) relevant UK earnings chargeable to income tax (b) basic amount (￡3,600 for 2011/12) Notes: Contributions exceed maximum amount do not attracting tax relief, which is wholly paid by individual. 2.1 tax relief for personal pension scheme Relief 1 is given at source by the contributions to be made net of basic rate tax. (restricted by the maximum amount) HMRC then pay an amount of basic rate tax (20%) to the pension provider. Relief 2: Further tax relief is given if the individual is a higher rate or additional rate taxpayer. The relief is given by increasing the basic rate limit and the higher rate limit for the year by the gross amount of contributions for which he is entitled to relief. (restricted by the maximum amount) Example 1 Albert has no earnings for the tax year 2011/12. He had gross contribution for personal pension scheme of ￡4,000. So tax relief is only given in respect of his gross contributions of ￡3,600. The amount of tax relief is ￡720 (3,600 at 20%), so Albert will have paid ￡3,280 (4,000 – 720) to the personal pension company. Example 2 Barry has earnings of ￡20,000 for the tax year 2011/12. All of his contributions of ￡12,000. Therefore qualify for tax relief, and he will have paid ￡9,600 (12,000 less 20%) to the p