Working less hours

Soniboy84

Hi,

Welcome to the forum, i'm new here!
So i was thinking, that how much could be a tax if i work 4 hours a day instead of 8.
Let's say i got £6.5(i know, it's crap, but that's what i earn). At the end of the 2 week period, i get around pure £420(taxes deducted).
I wonder, if i would do the same job in 20 hours a week(4hours a day), would i earn only £210/fortnight , or much more?

I just hear from everywhere, that some people, who work half as much as me gets the same amout... Shouldn't be fair. Or logical.
Thanks for all answers!

CLAPTON

It depends upon your tax code but assuming you have a standard tax code of 647L and all other things being equal then

it works a bit like this

Income per week £6.5 x 40 hours = £260
you can earn about £124 before tax at 20% so tax is (260-124) x 20% = £27
and NI is 11% above 110 per week so NI = (260-110) x 11% = £16.5

so total deductiona about £43.5 so take home should be about £216 per week


If you reduce your hours to 20 per week then your weekly income is 130
tax is (130-124) x 20% = £1
NI is (130-110) x 11% = 2.2

so total deduction should be about £3.2
and take home should be about £126 per week


If you are paid every two weeks then just double the figures.

Soniboy84

Thanks Clapton!

That's exactly what i needed! So if i would have 2 jobs, with both 4 hours, and same salary... you know where I'm going?
..would i earn approx. £1000 instead of £860 (/month)?
To be honest, it's worth to work in 4 hours a day(or even less, to reach £124), and
in your freetime do some self employment work...

Chinkle

It doesn't work like that soniboy. If you had a second job for the same hours at the same pay you'd be paying the same as you are now.

It only seems like your colleagues who work less take home proportionally more because everyone gets a tax free allowance and tax and NI kick in above certain thresholds. Above this you pay basic rate and then higher rate tax. Doing two jobs or even one job and then some self-employment aren't going to save you any tax as it's what you earn in total that counts.

flea72

you do know you are taxed on income as a whole?

F

Soniboy84

I see, i didn't know...
Higher tax rate kick is around £40000/year, and is 40%, isn't it?
That's my last question, so all of you, thanks for the answer.

CLAPTON

just to add

as Chinkle say, your total tax depends upon your total pay.. it doesn't matter whether you have one job, two jobs or more... the way it would works is that your first job would be taxed as I explained above but your second job would all be taxed at 20% (without any tax free allowance).

However with two jobs you would pay less NI as that's worked out on each job separately.


40% tax starts at 43,875