Tax attax

Discussion in 'Armed Forces Pension Scheme' started by watertight, May 13, 2011.

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  1. Can anyone give any advice........

    Leaving the Army end July, already started a new job and have been taxed at 40% for the remaining tax year on that i.e. until April 2012. Called them up and explained that whist I am currently earning two salaries my Army one will cease end July 2011 so I will not be earning two salaries for the entire tax year. I am told I will remain taxed at 40% because my whole income for the tax year includes my terminal grant. When I asked if my terminal grant should be included in my annual earning the tax lady said yes. So I called SPVA and they said no, it should not be taken into account for my annual earnings for this tax year. Soooooooo.. I called the tax people back and they said SPVA are wrong but it MAY be (although they could not confirm) that the MOD has special circumstances. Jesus, I thought the tax helpline was the centre of excellence on all tax matters! Soooooooo, I called SPVA back and the lady said, after putting me hold because she didn't know (why is she working there) and told me I should call the tax office as they are giving me incorrect information!

    Who the f**k is right?
  2. Your terminal grant IS tax free, as is the pension lump sum for AFPS 05 members and the Resettlement Grants for both schemes.

    There was something in the press some months ago about redundancy lump sums over £30K being taxed at 40% on the excess but the Armed Forces are exempt from tax on redundancy payments anyway - so the taxman can't be getting muddled with that.

    The taxman should looking at your earned income, which comprises any pay you are getting and your pension.

    Good luck.
  3. Thank you, very much appreciated, now to re-engage......
  4. I can understand you getting hammered on tax, since you have two job's, army & civi, until you get one job at your end of army contract
  5. Don't talk to them on the phone,get an appointment at your local tax office.

    Tax Office in Cardiff fucked me about with tax on my pension whilst working,then started again when I retired early,one trip to my local tax office,10 minutes later Tax rebate sorted,tax on pension sorted,and if you want to talk to another tax office,they have direct telephone lines,no waiting,no wasting money on the phone,you pay for this facility,use it,good luck! ;-)