Adjusted net income (UK)
Adjusted net income starts with taxable income before personal allowances and reflects specified reliefs and adjustments, including eligible trading losses and grossed-up Gift Aid or pension contributions where applicable. It is used in calculations such as the income-related personal-allowance reduction and High Income Child Benefit Charge. The steps, thresholds and contribution treatment depend on the relevant tax year; avoid deducting the same relief twice.
Worked example
A taxpayer identifies taxable income and eligible reliefs, then adjusts for a qualifying gross Gift Aid donation when computing adjusted net income, taking care not to deduct that amount twice.
Common mistake
Using take-home pay as adjusted net income, or deducting the same pension contribution twice because its treatment in the initial computation was overlooked.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | TX (UK) | Supporting | June 2026–June 2027 |