Can you please help:
M had UK earnings of £3000 in 2014/15 .what is the maximum actual amount of pension contribution she can pay in 2014/15 to a personal pension?
A. 2400
B. 2880
C. 3000
D. 3600
According to me the answer should be D. 3600 because the higher of 3600 or the earnings which is 3000.
But the answer is given 2880.
(3600*80%)
Please explain why this treatment?
Thank you
Ask the Tutor ACCA TX-UK
personal pension
The question asks for how much "she can pay". The gross amount of contributions allowed is indeed 3,600 but personal pension contributions are paid NET of 20% basic rate relief at source - hence the amount she pays is 80% x 3,600 as you show above!
Ohh okay thank you sir!!
You should easily have been able to find this from the OT course notes!! See chapters 25 & 26.
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