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Contribution confusion

24 October 2007
Issue: 4131 / Categories: Forum & Feedback

I have been suggesting to clients that they consider making lump sum pension contributions in alternate fiscal years so as to reduce their income for tax credit purposes. This can mean up to 96% (22% + 37% + 37%) combination of tax relief and tax credit and takes advantage of the new rules governing pension contributions combined with the £25,000 disregard in respect of increases in income for tax credit purposes.

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