Client's earnings for 2018/19 projected to be £150,000 on the nose.
He wants to make an employer pension contribution before the end of this month.
He only has £40k carry forward available from 17/18. All other annual allowances have been used up or are too old to carry forward.
An employer contribution of £26,666 would taper his annual allowance for 2018/19 to £26,667.
Making an additional employer contribution of £40,000 using carry forward would use up his allowance from 17/18.
Does he have to split it into two payments? A single employer contribution of £66,666 would taper his annual allowance for 18/19 to £10k, leaving him with an excess of £16,666 over the amount available for carry forward. How is this recorded so he doesn't get hit with a AA tax charge?
Also, how on earth do HMRC plan on checking all this? Incidentally, his income in 17/18 was just below £110,000 so the £40,000 Annual Allowance is safe.
I have another client who will be hit with an Annual Allowance tax charge for 17/18 and 18/19. Whose responsibility is it to tell her how much she has to pay?
Thanks in advance for any help!