• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

Annual allowance

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA TX-UK Exams › Annual allowance

  • This topic has 2 replies, 2 voices, and was last updated 5 years ago by cindy1228.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • January 16, 2020 at 10:05 am #558832
    cindy1228
    Participant
    • Topics: 63
    • Replies: 118
    • ☆☆

    Hi tutor

    This may sound silly but what is the purpose of ANNUAL ALLOWANCE OF 40,000?

    Having determined the pension contribution for tax relief between the lower of gross total contributions or the higher between 3600 and 100% of relevant earnings, I am not sure what will the annual AA purposed for.

    January 20, 2020 at 3:33 pm #559204
    Tax Tutor
    Member
    • Topics: 2
    • Replies: 3965
    • ☆☆☆☆☆

    Although tax relief is available on pension contributions paid up to the amount of relevant earnings for a tax year, the annual allowance then acts as an effective maximum annual limit. Where tax relieved contributions based on relevant earnings are paid in excess of the annual allowance (including any brought forward unused allowances), then there will be an annual allowance charge. This charge is then subject to income tax at a person’s marginal rates.

    January 22, 2020 at 12:42 am #559414
    cindy1228
    Participant
    • Topics: 63
    • Replies: 118
    • ☆☆

    Thank you so much for the clarification. Now clearer!

  • Author
    Posts
Viewing 3 posts - 1 through 3 (of 3 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • darshan.69 on Chapter 9 Pension Schemes TX-UK FA2023
  • darshan.69 on Chapter 9 Pension Schemes TX-UK FA2023
  • Jarzin on The Finance Function in the Digital Age – CIMA E1
  • dkessilfie on FM Chapter 1 Questions – Financial management objectives
  • ahmadhoney on ACCA Advanced Audit and Assurance (AAA) The Audit Report 3: Types of Audit Report

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in