Can I get tax relief on pension contributions against dividend income?

D

daheff

Registered User
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232
Hi

Is dividend income counted towards your overall annual income? The reason I ask is if it would be possible to use dividend income to increase annual income so that your annual income was then at the higher tax band level -thus allowing Pension contributions to benefit from a higher tax rate (40% rather than 20%)

EG presume i earn 30K a year. Tax cut off is 36K. If I have dividend income of 20K, would that then bring me into the higher tax bracket for pension contributions?

TIA
 
You can't set the €6,000 pension contribution against your dividend income.

But the €20,000 dividend income pushes the salary into the 40% tax band, so you get tax relief on your contribution at 40%.

Brendan
 
Just to clarify one other point.

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So, if our friend in my example is 35 years old, the most he can contribute is 20% of his salary of €30,300 or €6,060.

He can't contribute 20% of €50,300..

Brendan
 
Brendan Burgess said:
You can't set the €6,000 pension contribution against your dividend income.

But the €20,000 dividend income pushes the salary into the 40% tax band, so you get tax relief on your contribution at 40%.

Brendan
Click to expand...
thanks for that Brendan.
 
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