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D age 67
State pension £4500, private pension £2300
Received BSI £14400 and interesting of £600 on Saving certificate.actual received cash amount.
made donation during 2010/11 £300 gross to local charities.Not undersatnding in answer:
showing:
PAA 9490
less half excess £2200 x1/2 (950)Revised 8540
where is £2200 comeing from?
This figure is adjusted net income (4500+2300+18000+600-300=25100)-22900=2200
Are you sure its says Saving certificate as this is exempt so adjusted net income would be 24500 and the restriction=24500-22900 x 1/2It is intereing of £600 on maturity of Saving certificate from National Saving and Investment during the 2010/11.
that is I through too, but the answer show£2200 x1/2. in this case this should been£1600×1/2. as Saving certificate is exempt
Hi,
In the question, it says
1. The interest of 600 was from certificate, therefore exempt.
2. The donations were to local charity. The question specifies they were not made under gift aid, therefore they don’t affect adjusted net income.4500+2300+(14400*100/80)=24800
(24800-22900)=1900
9490-(1/2*1900)=8540You can find 1900 in the answer and then suddenly it turns into 2200 in the book. However the final answer on BPP is right, adjusted PAA=8540. Maybe last year, they set the question like the way Yvonne did it above and then they changed it this year, but they forgot to change 2200 into 1900. The final answer is right. No wonder I didn’t spot the 2200.
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