Armed Forces Pension & civilian employment

Discussion in 'Finance, Property, Law' started by chris951, Mar 15, 2006.

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  1. chris951
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    chris951 War Hero

    This may turn into a salutory lesson for me and a useful warning to those who are approaching the end of their service!

    I left the Army in 2003 on completion of 22 years service. I now have a pretty decent job which pays rather well. The company I work for has PAYE and I tended not to look too closely at my tax each year. (Foolish??)

    That changed today when I had a little think and I suspect that I have underpaid my tax by as much as £1300 per year for the last 2-3 years.

    Both my AF Pension tax and my salary tax are administered from the same tax office but I have a suspicion that my tax is not being calculated taking both incomes into account. I spoke to a collegue who is ex-RAF and he said the same thing happened to him and he got hit with an £18,000 tax bill.

    I am now worried and think I should write to my tax office and clear this up sooner, rather than being hit with a big bill 2 or 3 years down the line.

    Has anyone else encountered this problem and how was it resolved?

    If you are leaving soon and think you may hit the 40% threshold, make sure you keep a close eye on things before they get out of hand!
     
  2. Lucky_Jim
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    Lucky_Jim LE

    Chris,

    If it helps I've got the current tax thresholds and percentages at home. When I get in from work I can post or PM them to you if you like? Then you can work out how much you shuold be paying before dobbing yourself in.
     
  3. chris951
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    chris951 War Hero

    L-J,

    Thanks for the offer but already got them. Wacked together a spreadsheet and did some modelling ... gulp! Shall be going through all my old P60's tonight to see what the full damage is. I may be casting arouond for historical rates & thresholds.

    edited for poor spelling!
     

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