Tax code and pay query.

[5corpio]

Re: Tax code and pay query.

Fury as Revenue & Customs tells taxpayers 'check your own code'

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[di30]

Re: Tax code and pay query.

Like I said NI is a lower threshhold and is fixed. NI is payable only a fixed amount of salary between an upper and lower threshold. Also it pays to rememebr that NI is payable and calculable on GROSS salary not NET salary as well.

regards
Garlok

Thank you Garlok, and yes it all seems to make sense now for sure.

Ooh they say we learn something new everyday cheers for the explanation x

[garlok]

Re: Tax code and pay query.

Like I said NI is a lower threshhold and is fixed. NI is payable only a fixed amount of salary between an upper and lower threshold. Also it pays to rememebr that NI is payable and calculable on GROSS salary not NET salary as well.

regards
Garlok

[di30]

Re: Tax code and pay query.

what you need to do is split the tax allowance by the fequcuency of being paid to get the pay threshold before getting taxed and paying NI contributions

for example i'm paid fortnightly so i take the tax free allowance of 7475 and divide it by 26 (as i get paid 26 times in a tax year) to find my threshold which for me is £287.50 before i get taxed. Anything over this is taxed at 20%

NI threshold is £139 a week after which 12% of earnings goes to NI contributions.

I hope this helps somewhat.

Ooh thank you, that will be a great help cheers and for anyone else who may wonder how its worked out.

Thank you so much.

[kilasuit]

Re: Tax code and pay query.

what you need to do is split the tax allowance by the fequcuency of being paid to get the pay threshold before getting taxed and paying NI contributions

for example i'm paid fortnightly so i take the tax free allowance of 7475 and divide it by 26 (as i get paid 26 times in a tax year) to find my threshold which for me is £287.50 before i get taxed. Anything over this is taxed at 20%

NI threshold is £139 a week after which 12% of earnings goes to NI contributions.

I hope this helps somewhat.

[di30]

Re: Tax code and pay query.

Hi Di,

Happy New Year to you and yours. Sorry for not getting back straight away to your last. However that will explain entirely the reason for him paying tax. As I said his employer will be looking at the "Tax Tables" probably week 39 or month 9. All earnings for the current tax year are taken into account and certain benefits are counted as "earnings" as well.

Glad it seems to have been sorted.

regards
Garlok

Thank you Garlok, and a Happy New Year to you too! X

Yes that does make lots of sense, I think her son must have made contact to query this and it seems they explained it the way you have too.

Wonderful, thank you so much Garlok and hey no need to apologise, its been a very busy time. X

[garlok]

Re: Tax code and pay query.

Hi Di,

Happy New Year to you and yours. Sorry for not getting back straight away to your last. However that will explain entirely the reason for him paying tax. As I said his employer will be looking at the "Tax Tables" probably week 39 or month 9. All earnings for the current tax year are taken into account and certain benefits are counted as "earnings" as well.

Glad it seems to have been sorted.

regards
Garlok

[di30]

Re: Tax code and pay query.

Thank you everyone, my friend also appreciates it big time.

Anyway, I was mistaken and forgot her son was working and not unemployed before he had taken this current job, and it appears that whatever he earned to date from the previous employment is to be included on top of the amount to date with this company, which is why they have only now started to tax his pay.

[garlok]

Re: Tax code and pay query.

Thats clarified it a bit more. I did my calculations based on him working for the whole of the tax year to date, i.e. from April. He has only worked from July and his employer will work directly from the tax tables, based on what has been said Week 39 or Month 9 and that will tell the employer to start deducting tax at the levels of salary he gets. As others have said it will probably be finally sorted at P60 time at the end of the tax year when overall levels of earnings are assessed fully.

He will probably like the rest of us be on self assessment and will have to fill in his own forms, (much of which is on-line now heaven help us all via Acrobat Reader X) but we found these last two years that the figures are all calculated as you go and you will know if you have any to pay or whether a refund is due. The first year we did this a small refund I think about 11 quid was owing to us and it was paid automatically into the bank. This year we had to pay about 50 quid extra and a bill arrived with a bank payslip.

He also won't have the complication of a P11D to consider either as I assume he gets no benefits in kind from his employer.

regards
Garlok

[Never-In-Doubt]

Re: Tax code and pay query.

going on that payslip it seems they've assessed his income and realised he will exceed the threshold therefore this was the first month of tax - basically if come April 6th he's still under the £7400 limit he can send a letter in with his P60 and they'll refund him in his next wage - it's all very simple really....

In the to date totals, tax shows £41 ergo this is his first month of tax based on the fact he's likely to earn more than £3000 in the next 4 months pay. so roughly £160 tax would have been paid, around £150 would be owed back. and my guess is they've done this as his current employer wasn't given the P45 from when he signed off so tax office doesn't know his pre-april earnings (ie dole money).

[di30]

Re: Tax code and pay query.

If he was unemployed for over a year, he should look into working tax credits.

Thanks Oscar

I think her son is in his early 20's and still lives with his parents, well his mum anyway, so not sure if he is eligible or not, think you have to be 25 and over, will check on this though, cheers for that.

[oscar]

Re: Tax code and pay query.

If he was unemployed for over a year, he should look into working tax credits.

[di30]

Re: Tax code and pay query.

I have asked for permission from his mum to post details on here, but I have not scanned the slip just copying the details as shown.

I do know he was unemployed for over a year before starting this job in July 2011.

.................................................. .............................................

Salary 1166.67

Deductions

NI £67.76
PAYE £41.00
Student Loan £0.00

TO DATE
Taxable Pay £4865.90
TAX £41.00
Nat Ins £294.95


Pay date 31 Dec 2011
Tax code 747L

Total deductions £108.76
.................................................. ..................................................

(Not eligible to pay for Student loan at this point as earnings just under £15K).

[di30]

Re: Tax code and pay query.

No he will get taxed the basic rate should he earn under his taxable allowance he will get a return.

Thanks Jen

Been going through his wage slips with his mum and as above, he started the full time job in July, and this is the first one he has been taxed on, he gets paid every last Friday of each month.

Cheers.

[di30]

Re: Tax code and pay query.

As he got a 2nd job elsewhere ?........

Hi

No, he started this job in July and is his only job 38 hours a week.

Cheers.