Alice has been in a defined-contribution pension scheme since she was 35 and will retire in one year’s time at age 66. Her salary is currently £55,000. Throughout her enrolment in the scheme, she has paid in 8% of salary, and this has been topped up by employer contributions and tax relief worth 4% of salary. She will also qualify for a state pension of £9,000 per year. 1.1 If Alice uses her whole pension fund to buy an index-linked annuity, how much income will she receive in her first year of retirement? I Would like know how do the exercise , no the answer , why the total annual is 660.000 ?

Alice has been in a defined-contribution pension scheme since she was 35 and will retire in one year’s time at age 66. Her salary is currently £55,000. Throughout her enrolment in the scheme, she has paid in 8% of salary, and this has been topped up by employer contributions and tax relief worth 4% of salary. She will also qualify for a state pension of £9,000 per year. 1.1 If Alice uses her whole pension fund to buy an index-linked annuity, how much income will she receive in her first year of retirement? I Would like know how do the exercise , no the answer , why the total annual is 660.000 ?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter15: Choice Of Business Entity—other Considerations

Section: Chapter Questions

Problem 60P

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