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Confused
Alastair83
Posts: 2 Newbie
Hi all
I was wondering if you could help me, I live in Scotland so know the tax rate us slightly different but below is my question
Currently I get £40,000 per year gross wage with fully expensed company car, this will move to £45,000 which leads me to believe ill be a higher tax payer
so my questions are
with me moving to a higher tax rate does this mean my BIK for company car will double to 40%
I'm looking to start taking out childcare vouchers per month which will be tax free but if I take out the max allowed this will bring my taxable rate down wont it as it will make my gross wage under the £3,583 per month ? does this mean my BIK would stay at 20%
last question, is it worth jumping to £45,000 or would I be better only going to £43,000 and remaining at 20% for company car
hope that makes sense
I was wondering if you could help me, I live in Scotland so know the tax rate us slightly different but below is my question
Currently I get £40,000 per year gross wage with fully expensed company car, this will move to £45,000 which leads me to believe ill be a higher tax payer
so my questions are
with me moving to a higher tax rate does this mean my BIK for company car will double to 40%
I'm looking to start taking out childcare vouchers per month which will be tax free but if I take out the max allowed this will bring my taxable rate down wont it as it will make my gross wage under the £3,583 per month ? does this mean my BIK would stay at 20%
last question, is it worth jumping to £45,000 or would I be better only going to £43,000 and remaining at 20% for company car
hope that makes sense
0
Comments
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Your tax rate will depend on your total taxable income. Without knowing the benefit value of the company car it’s hard to comment. Also if paying into a pension that will effect it.
Google salary calculator and use that website to work it out. There’s an option to compare two salaries.0 -
You have misunderstood how tax works.
There is no tax rate for company cars, you pay whatever tax applies to your personal circumstances.
So in a very simple scenario if you were on £40000 and had a car benefit of £3001 you would be a 40% payer. But you would only pay 40% tax on £1.
From your original post you already appear to be a higher rate payer as the standard limit in Scotland is £43000 so you must have a very low car benefit, you have overstated your salary (it is taxable salary which counts) or are paying some 40% tax.0 -
I'm confused by why you have posted this question in the Benefits forum and not the Tax forum - http://forums.moneysavingexpert.com/forumdisplay.php?f=22
I'm also puzzled by why you would decline a salary increase. If you are so exercised at paying 40% tax, why not increase pension contribution to bring your taxable income back to the 20% rate?
This Company Car Tax calculator may help you:
http://cccfcalculator.hmrc.gov.uk/CCF0.aspxAlice Holt Forest situated some 4 miles south of Farnham forms the most northerly gateway to the South Downs National Park.0
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