Person Pension and Carers Allowance

When I take my Person Pension, I will be above the Personal Allowance from the tax year 23/23 onwards, with my company taking tax before I receive it. As I also receive Carers Allowance, how will that be taxed, by who?

*correction, year 23/24 onwards

Hi,

If you receive Carers Allowance, you should inform our Income Tax team so that we have this noted on our records to be included as part of your taxable income.

Income Tax: general enquiries

Thank you.

I receive carers allowance since 2020. I informed HMRC and my code was reduced to claw back tax not paid. The next year they did not add /ask work pension scheme to consider and so had to claw back more when I advised them, very confusingly 3 different codes in the year. The estimate code for 23/4 has been sent. HMRC have advised that my carers allowance is a deduction and have taken it off my personal allowance code. EG 12570L minus £ 4007 equalling a tax code of 856L Surely the allowance should be added to my pension and my personal allowance of 1257 L applied otherwise my allowance has been reduced by the carers allowance meaning it makes it nil and void .

How did they work out the amount of £4007 ?

Hi What Simmons,

As Carers Allowance is not taxed before you receive it, the amount is deducted from your Personal Allowance so that we know how much you have left to set against the rest of your income.

Thank you.