Entitled to a bigger State pension?
HMRC is contacting thousands of people by post, mainly women, to highlight that they may be eligible for a higher State pension than they realise. An error in National Insurance records has meant those eligible may have missed out on a provision called ‘home responsibilities protection’ between 1978 and 2010. The letters are going out in phases and explain how to check for eligibility and then claim, potentially adding thousands of pounds to State pension entitlement. It might sound like the kind of postal scam to be wary of, but it isn’t.
Student loans hit by marginal tax rates
Last December’s Scottish Budget introduced a new ‘advanced’ 45% income tax rate covering taxable income between £62,430 and £125,140. One unfortunate consequence of the change was to create a potential marginal ‘tax’ rate of 78.5% on earnings between £100,000 and £125,140 for graduates still repaying their student loans (67.5% effective income tax rate + 9% graduate repayment + 2% national insurance). If you think you have escaped this by living outside Scotland, be warned – the equivalent elsewhere in the UK is 71%.
The Financial Conduct Authority does not regulate tax advice.
New online trading data sharing rules
If you sell things online using sites such as Ebay or Vinted, or rent out your home via Airbnb or similar sites, those platforms will now automatically share data with HMRC. The rules are designed to ensure that those earning via digital platforms are fully declaring their correct income and tax. There is an ‘occasional seller’ exclusion for those making less than 30 sales under the value of around £1,700. The relevant platforms will start reporting data from 1 January 2025, so there’s time to understand if you could be affected.
The Financial Conduct Authority does not regulate tax advice. Tax treatment varies according to individual circumstances and is subject to change.
