Am I really worse off with two part time jobs?

catmango

Sorry, its a bit long and complicated, so please bear with me if you can!

Right:

I work for the NHS, and for the last 8 months I've been temporarily promoted to cover my manger's maternity leave. She's coming back to work next month, but she's only coming back three days a week.

Now, when she returns, I've been offered the chance to do my original job for those three days, and her job for the other 2. This means in essence that I would be a grade 2 for 3 days a week, and a grade 3 for two days. I assumed that I would just be paid as normal, but it turns out that the way the NHS work salaries, I would in fact be paid for TWO part time jobs.

I'm under the impression that this will affect my tax and NI quite a bit, but I'm not sure. The two jobs will actally both have virtually the same salary, and I'll be working the same amount of hours every week, 37.5, but split into 22.5 and 15, in the same department.

I'm in two minds whether or not to take this job, how much difference will it make to everything if I do?

Baileys_Babe

As far as I'm aware you will not be worse off as you will still be using the same tax allowance.

Sorry if I'm wong.

oldwiring

Is it right to assume from your post that the salaries will not be amalgmated on to one pay slip? If they will not, will your Personal Allowances and the amount due for taxation at the lower (10%) rate be covered by one salary. On the assumption that they will be, it will work out OK. IMO. if the second salary is taxed at basic rate (Code BR). Your problems. as I see it, will arise were there insufficent income on the principal job to cover the elemets mentioned , or the comnined salaries took you in to the higher tax (40%) rate. You could have to make an enf of year claim or be prepared to fund an undepayment of tax.

You may have to look into being overcharged for NI contributions, See what D of W&P has to say.

I repeat; these are only my thoughts out of a rusty mindand I may be corrected by those more with it.

catmango

oldwiring, my salaries will be on 2 wage slips, and the (slightly) lower salary will have the personal allowances. So you're saying that this scenario should work out ok?

I also have superannuation to consider too!

As far as the 40% tax bracket goes, I work for the NHS, It won't be a problem :rotfl:

nrsql

Would you be considered a full or part time employee (or two)?
It might have a bearing on pension, rights, benefits, ....
No idea what the law is about this sort of thing now.

Andy_L

ts_aly2000 wrote:

I think we're seeing yet another way in which the NHS wastes money

In what way? It's marginally cheaper than employing 2 part timers and if they can replace 2 full times posts with 2 part times thats actually saving money.

GSD4ME

I might be totally wrong, but I thought you only had to pay NI on one salary and if you do 2 part time jobs you would only pay NI on one, which would work out cheaper.

Is this right or am I talking utter rubbish??

Aark

If you have two or more unconnected jobs, NICs are calculated separately on each.

However, that is not the case here and the two jobs are with the same employer. So, from http://www.hmrc.gov.uk/guidance/cwg2.pdf:-

67 An employee has two or more jobs with the same employer

If an employee has two or more jobs with you at the same time, the general rule is that you must add all the earnings together and work out NICs on the total.

If the earnings from each job are separately calculated, you do not have to add the earnings from the separate jobs together if it is not reasonably practicable to do so.

oldwiring

GSD4ME wrote:

I might be totally wrong, but I thought you only had to pay NI on one salary and if you do 2 part time jobs you would only pay NI on one, which would work out cheaper.

Is this right or am I talking utter rubbish??

AFIAA NI conributions are payable on gross earnings between a minimum-the Earningd Threhhold (ET)- and maximum amount- Upper Earnings Limit (UEL)- in the salary period @ a certain %age according to status, e.g. <contracted out> or <not contracted out> with any earnings above the UEL being charged at 1%. A person having two jobs could have, for example, job A on which deductions are made on the basis of that salary and job B, where no deductions are made because the ET is not reached; an underpayment of contributions would result, Another scenario would be both jobs attracting contributions at the standard rate on earning between ET and UEL. Contributiosns however are due on the combined gross earnings above the ET up to the UEL with the excess chargeable at 1%. As I see it either an underpayment or an overpayment could result.Who deals with I don't know, but it is haed spinning:eek:

MarkyMarkD

Aark wrote:

If you have two or more unconnected jobs, NICs are calculated separately on each.

However, that is not the case here and the two jobs are with the same employer. So, from http://www.hmrc.gov.uk/guidance/cwg2.pdf:-

67 An employee has two or more jobs with the same employer

If an employee has two or more jobs with you at the same time, the general rule is that you must add all the earnings together and work out NICs on the total.

If the earnings from each job are separately calculated, you do not have to add the earnings from the separate jobs together if it is not reasonably practicable to do so.

Doesn't that bit of HMRC guidance unhelpfully mean that, if your employer is too lazy/stupid to add the two jobs together, you CAN end up over-paying NI and it's your hard luck? 'Cos that's how it sounds.

Aark

MarkyMarkD wrote:

Doesn't that bit of HMRC guidance unhelpfully mean that, if your employer is too lazy/stupid to add the two jobs together, you CAN end up over-paying NI and it's your hard luck? 'Cos that's how it sounds.

I'm not entirely sure how it works in practise, but there is guidance (http://www.hmrc.gov.uk/bulletins/tb48.htm) which says "If there is disagreement between the employer and the Inland Revenue it will be a question for the Commissioners to determine. The onus is on the employer to show that aggregation is not reasonably practicable because it is the employer making the judgement".

The OP will have to ask their employer to find out how they intend to deal with NICs. If aggregated, the NICs paid will be the same as if it was one job. If they are taken separately, the NICs paid will be less as you will get two lots of Earnings Threshold.

This could have a knock-on effect on State benefit entitlements.

Income Tax will not be affected either way, as all income for the tax year is always aggregated. It will just be a matter of having an appropriate tax code for each job if separated, as already discussed in this thread.