tax

pavlovs_dog

was just looking for somwone to educate me to the ways of the inland revenue (bah humbug)

i work part time at argos, where i earn on average £80-£100 a week. as my only other job was cash in hand, this is, as far as the tax people are concerned, my first ever job.

when i started, i signed some kind of tax exemption form, declaring myself as a student. i thought this would mean i would pay no tax or National insurace until i graduated, however, every time my pay packet hits the £100 (or there abouts) mark, i see some of my hard-earned cash disappear into mr brown's back pocket.


i know something about a £4000 odd personal limit per annum, and as i only stated in august, i know for definite that my earnings wont breach that allowance this financial year.

what i want to know is, is it 'right' (and please lets not get all ethical here, we'll be here forever otherwise ) that i am being taxed, even though i have signed the student exemption thingy, and am earning less than my annual personal tax allowance?

if i shouldnt have been taxed, is there any way i can claim it back? will i get a rebate or anything, or is that just wishful thinking?

stuwilky

Are you being taxed or are you paying National Insurance?

The form you filled in was possibly a P38 which basically declares that you will not earn the personal allowance for income tax purposes during the fiscal year. So unless you have already earnt over approx £4400 - I cant remember the exact amount - you shouldnt be paying tax.

National Insurance however, is a weekly thing. Once you earn above the earnings threshold for NI (and I have no idea what it is - last time I knew it was £87 but i could just have easily have made that up) you pay NI on your earnings.

Think that answers, in a waffley type way.

EDIT - Unless you are over 65 - then you dont pay NI ;-)

pavlovs_dog

stuwilky wrote:

EDIT - Unless you are over 65 - then you dont pay NI ;-)

cheeky monkey

im currently paying both. its a drop in the ocean really, but if its money that i dont have to pay out, well then i can be using it much more constructively....


so if i shouldnt be paying it, any chance i can get it back?

crana999

What tax code does it say on your payslips? It's possible that you are still on an "emergency tax code" even if you shouldn't be, if your work is just rubbish about sorting it out. This is where, AFAIK, they tax you at 20% till they work out what tax code you *should* be on.

If so, once your actual tax code comes through, you should get a refund of your tax paid in your wages.

It's probably worth having a word with your line manager or whoever - there could have been a problem with the paperwork and they never got round to sorting it out!!

One thing to bear in mind is that your personal allowance also includes any interest on savings and other sources of income, although they'd be unlikely to take you over the threshold you need to be careful if you are getting close to your personal allowance limit.

pavlovs_dog

my tax code is 474L

^had a look on the IR website at the tax code section, but didnt really learn much tho. all it says is:

Tax codes – the numbers and letters
Your tax code is usually made up of numbers and letters.

The examples below explain how the numbers are worked out
The letters are explained below.
If your tax code is a number followed by a letter:

the number in your tax code is used to work out the tax due on your income from your employment or pension
the letter simply shows how it should be adjusted following any changes announced by the Chancellor. It does not affect the amount of tax you pay.
This is what the letters mean:

L is for a tax code with the basic Personal allowance.
P is for a tax code with the full Personal allowance for those aged 65 – 74
V is for a tax code with the full Personal allowance for those aged 65 – 74 plus the full married allowance for those born before 6 April 1935 and aged under 75 and we estimate that you are liable at the basic rate of tax.
Y is for a tax code with the full Personal allowance for those aged 75 or over.
T is used if there are any other items we need to review in your tax code or if you ask us not to use any of the other tax code letters listed above.

doesnt take much to confuse me lol!

also, whilst i have your attention, i have NI errors listed on my pay slip too...does that mean i owe them or they owe me?

atotori

Argos you say? They should have a Human Resources / Personnel Department ... or a least person available to you. Next time you go in to work, take a couple of your recent payslips with you, and ask to have a few minutes chat with your HR person.

S/he will go over the payslips with you and tell you what is being taken off your earnings and why it's being taken off. If there is a mistake and you are loosing money you are entitled to keep, s/he will be able to correct it for you.

Don't worry about asking to see someone in that dept, it is Personnel / HR's job to answer payslip related questions and to know how to sort out anything that is not the way it should be.

atotori )

Trow

A P38s - the student exemption form - is only relevant if you *only* work during school/uni holiday periods - its not relevant if you work part time all year round, so I suspect you are due to pay tax.

If you have overpaid tax in the year the good news is it is very straightforward to reclaim it - just write to the Inland Revenue and ask them for any refund due.

Out of curiosity - goes your tax code have M1 or W1 after it? If not then it wouldn't sound like you would be due a refund. If you want to PM me with more details (pay to date, tax to date) I can look at it in more detail for you.

stuwilky

Thats what the P38 was originally intended. However it can also be used if you work such few hours during the year that you will not reach your personal allownce, in the OP's case that is £4745.

It might be that you are fairly close to that threshold so with a few months of the fiscal year to go you are paying the relevant amount of tax. Someone further up suggested talking to HR - in my dealing with Argos they are appalling. they will also try and fob you off.

Make sure you have checked you gross ytd figure and you know that you will not reach that threshold by the end of the tax year.

abbas_ali_2

Hey,

I'm also a student and earn approx 80 - 100 quid a week. I also got one of these P38 things through when i started. Occasionally i have found i do get taxed a wee bit (like 4 quid) and thats like every so often so i dont really mind.

I'm pretty sure what it is that everyone is taxed and its a common misconception that students dont. It's just that no-one is taxed on the first £4785 of earned cash or whatever it is and most students dont earn that anyway.

Anyway just speak 2 ur Personnel manager but in my place they can be no help and if thats the case just contact the Inland Revenue direct (although they seem to put as many obstacles infrotn of you so you cant!)

Trow

stuwilky wrote:

Thats what the P38 was originally intended.

Absolutely, and that is what it is currently intended for as well.

stuwilky wrote:

However it can also be used if you work such few hours during the year that you will not reach your personal allownce, in the OP's case that is £4745.

It can be used - but should not be according to the Inland Revenue's guidelines.

I always use a P38 the way it is mean't - I'm not sure what the Inland Revenue would do if they discovered you were using it for students through the year - very little I would think as long as the threashold isn't breached, but I would still rather use it the way it is mean't - and it looks like the OP's employer is as well.

Trow

abbas_ali wrote:

I'm pretty sure what it is that everyone is taxed and its a common misconception that students dont. It's just that no-one is taxed on the first £4785 of earned cash or whatever it is and most students dont earn that anyway.)

Thats not quite the way it works. If a student only works during holiday times (say june, july, august) then their personal allowance in the year to date will only be 5 months worth of the total - slightly less than £2000 - as PAYE is done on a cumulative basis.

As long as the student a) only works during the holidays and b) has completed a P38s, they can then earn up to the years threashold of £4,745 during the holidays and pay no tax on it, whereas anyone that is a non-student would pay tax on anything above the £2,000.