Tax on bonus

mattdragon2

My mum is receiving a bonus of 2k for December only.

She earns 29k per year so she is not taxed upper limit.

Since the 2k will be added to her monthly wage, will the bonus be taxed more because it goes into the upper tax limit?

Can she claim any of the tax back ?

Thanks!

Hoddie_2

Your mother would only pay higher rate tax at month 9 of the tax year if her total gross pay to date (including the bonus) is more than approx £33,000. The bonus should be taxed at 20%.

McKneff

No she wouldnt be able to claim any of it back, it is income and is classed as such, sorry

nomoneytoday

If there is an overpayment based on 9/12ths of the salary so far then the 10th to 12th monthly payments will have slightly less tax.

It will all balance out by April 2010.

Hoddie_2

It will be basic rate tax (20%). 9/12ths of 29,000 is 21,750. This added to the bonus is still well within the basic rate band (approx 33,000) at that point in the year.

chrisbur

Without knowing what tax code or the basis this code is being applied on, or if there is any other taxable income, no one can tell exactly how this bonus will be taxed. Provided your mother has a tax code of around 647L and it is being applied on a cumulative basis, and has no other income, then as advised tax will be 20% on this bonus, if tax code is very different and/or is being applied on a month 1 basis, or has other taxable income, then different advice would need to be given.