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question on maximum gross personal pension contributuion

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA TX-UK Exams › question on maximum gross personal pension contributuion

  • This topic has 7 replies, 2 voices, and was last updated 8 years ago by Jean96.
Viewing 8 posts - 1 through 8 (of 8 total)
  • Author
    Posts
  • October 24, 2016 at 9:52 am #345790
    Jean96
    Member
    • Topics: 77
    • Replies: 67
    • ☆☆

    Nicola has made the following gross personal pension contributions during the tax years 2012-2013,2013-2014 and 2014-2015
    Nicola
    2012-2013 56000
    2013-2014 29000
    2014-2015 Nil
    Nicola was a member of a member of a pension scheme for all 3 years
    what is the maximum gross pension contribution nicola can claim in the tax year 2015/16

    October 24, 2016 at 12:35 pm #345821
    Tax Tutor
    Member
    • Topics: 2
    • Replies: 3965
    • ☆☆☆☆☆

    Show me your attempt at the question!

    October 24, 2016 at 5:30 pm #345885
    Jean96
    Member
    • Topics: 77
    • Replies: 67
    • ☆☆

    nicola
    2015/16 a.a 40000
    unused a.a b/f 61000
    maximum gross ppc 101000

    working unused a.a
    2012/2013 nil
    2013/2014(50000-29000) 21000
    2014/2015(40000-0) 40000
    61000
    my question is why is 2012/2013 nil it should not be (6000)

    October 29, 2016 at 10:49 am #346537
    Tax Tutor
    Member
    • Topics: 2
    • Replies: 3965
    • ☆☆☆☆☆

    Look at the numbers – the gross contributions are larger than the AA limit not smaller so there is NO unused AA available from that year. There would have been an AA charge in that year as a result (subject to what preceded it) – you do not carry forward a negative balance!

    October 29, 2016 at 11:15 am #346541
    Jean96
    Member
    • Topics: 77
    • Replies: 67
    • ☆☆

    but why in this answer 2014/15 is deducted from total
    Padma became a member of a personal pension scheme on 6 april 2012 and has made gross personal pension contributions as follows
    2012/13 £23000
    2013/14 £40000
    2014/15 £45000
    Padma’s tax adjusted trading income in the tax year 2015/16 is £300000

    What is the maximum gross personal pension contribution that Padma can make in the tax year 2015/16 without incurring an annual allowance charge?
    2015/16
    2015/16 annual allowance 40000
    unused annual allowance(w) 32000
    maximum gross ppcs 72000

    working unused annual allowances
    2012/2013(£50000-£23000) 27000
    2013/2014(£50000-£40000) 10000
    2014/2015(£40000-£45000) used in 2014/15 (5000)
    unused annual allowance 32000

    October 29, 2016 at 8:55 pm #346593
    Jean96
    Member
    • Topics: 77
    • Replies: 67
    • ☆☆

    answer plz

    November 4, 2016 at 12:44 pm #347365
    Tax Tutor
    Member
    • Topics: 2
    • Replies: 3965
    • ☆☆☆☆☆

    In the first example there was no unused AA b/f into 2012/13 so that an AA charge of 6,000 would arise whereas in the second example in 2014/15 there is unused AA of more than 5,000 b/f from previous 2 years. Thus the 45,000 would be all be allowable in 2014/15 and the unused AA c/f would be reduced by 5,000.

    November 5, 2016 at 3:16 pm #347596
    Jean96
    Member
    • Topics: 77
    • Replies: 67
    • ☆☆

    sorry, i dont understand your answer could it be clearer?

    in the first example in 2012-2013 (50000-56000)=(6000); the unused AA is Nil

    in the 2nd example, why do we have to add the (5000) for 2014-2015 to the total of the 2 preceding years, should it not be NIL as in the 1st example?

    Thanks beforehand for your help.

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