Pension

John had trading income of 180000 in 2013/14. He also received dividend of 90000. He does not have any unused annual allowance brought forward. What is John's income tax liability for 2013/14. The examiner said that the excess annual charge would be subject to income tax at the taxpayer's marginal rate(s) of income tax by treating the excess contributions as an extra amount of non-savings income received by the taxpayer. This is the method that I normally calculated Income Tax Liability Non Saving 112010 x 20%..............................22402 67990 x 40%................................27196 ........ 180000 ........... 30000 x 40%...............................12000 Dividend Income 20000 x 32.5%............................6500 80000 x 37.5%............................30000 Or should I calculate like this Income Tax Liability Non Saving 112010 x 20%..............................22402 67990 x 40%................................27196 ........ 180000 ........... Dividend Income 50000 x 32.5%..............................16250 50000 x 37.5%..............................18750 .......... 100000 .......... Excess annual allowance 30000 x 45%..................................135000 Help me, Sir!