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Hi Sir
I’m a stuck on Adjusted Total Income (in relation to the loss relief cap) and every time I think I’ve got it, I get confused again!
1. Is it only gross personal pension contributions we subtract from total income – crucially, what I need to know is: do we or do we not deduct pension payments made under payroll giving schemes?
2. Is the ‘total income’, used in the ATI calculation, after we deduct any qualifying interest payments and any trading loss relief carried back? i.e. is it the total net income?
Thank you again for all your help.
Thank you,
Ali
Look at OT course notes p.5 where you will see the pro forma income tax computation – which you should know well by now – where Total Income is clearly identified. Also realise that either occupational pension contributions made by an employee and/or donations made under the payroll giving scheme (these are 2 separate things not one as per your statement above) will already have been deducted in deriving the employment income assessment for inclusion within the income tax computation.
Therefore it is simply the total income from the income tax computation less the gross PPC.
Hope this helps
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