bonus payment - tax?

village_life

hi

ive just received my annual bonus letter, and it looks quite a healthy figure :beer:

however, the letter doesnt say whether the payment is gross or net.

reading the plan rules, it says "any payments made will be net of tax, national insurance or any other deductions"

does that mean i get the whole amount advised on my letter?

Debt_Free_Chick

No - I would expect it to be the gross figure. It's difficult to predict the net figure, as your tax code could change between the date of the letter and the date it's paid.

Sorry - it will be the gross figure and you'll get a lesser amount, after tax

hobo28

ive just received my annual bonus letter, and it looks quite a healthy figure

It always does until the taxman gets his hands on his share!!!!

I agree with DFC, the amount is almost certainly gross.

Robert_Sterling

It is quite clear to me.
"Any payments made will be net of tax and NI"
So you have been told what the bonus is and you have been told that tax and insurance will be deducted.

village_life

Robert_Sterling wrote:

It is quite clear to me.
"Any payments made will be net of tax and NI"
So you have been told what the bonus is and you have been told that tax and insurance will be deducted.

therein is the confusion, my english works the other way around - i'd have expected it to say "any payments will be gross of tax and NI" -

from that gross figure, tax + ni deducted...........

kaya

a good friend of mine is a hot shot city trader and recieved his bonus of £80,000 recently, he actually ended up with £40,000something after the tax man had his share-daylight robbery

Andy_L

Why not ask the person who sent the letter?

Tiggs_2

Robert_Sterling wrote:

"Any payments made will be net of tax and NI"

Thats a pretty simple sentance!

They have said what the bonus is, thats X.

Now they say ANY PAYMENTS MADE.....they are now talking about what will be PAID to you.....this is no longer X, that was the bonus...not what you are paid.

WILL BE NET OF....means the tax will be taken first.


simple.

Debt_Free_Chick

village_life wrote:

therein is the confusion, my english works the other way around - i'd have expected it to say "any payments will be gross of tax and NI" -

They can't pay gross of tax and NI.... so any payments made will be net i.e. from what you are due, they will deduct tax & NI and pay you the rest.

Your bonus entitlement is the gross figure - what they pay (and what you receive) is the net figure.

hobo28

village_life wrote:

therein is the confusion, my english works the other way around - i'd have expected it to say "any payments will be gross of tax and NI" -

from that gross figure, tax + ni deducted...........

No, PAYMENT is what they are giving you. They cannot make a payment to you gross then deduct the tax. Thats deducted at source.

I can understand why you want to believe that you'll get the big figure, I often wish I'd get paid my salary gross too!

Sand_Man_2

bonus always get taxed at 40% i think. therefore, what ever it says on you letter from your employer, take off at least 40% straight away for a general guide to what you may see in real terms