Starting a new job soon-should I be paying income tax from 1st salary?

DEBTMONKEY1A

Hi guys/gals-finally got a good job :j! Trying to get my finances in order.....for the tax year 2010-2011 my wage will be (gross) £5425 (Dec-March wage)...plus I've had taxable Carers Allowence of £1941-giving total taxable income for 2010-2011 of £7366 (give or take a quid!). only other income was Income Support/Housing Benefit/a bit of working tax credit (joint) which I gather is non-taxable.

Now i realise my personal allowence is £6475 for this tax year. When i get my monthly wage will I be taxed at full rate & have to claim it back ? According to http://www.thesalarycalculator.co.uk/salary.php on my yearly FULL wage I should pay £163-20 a month tax. But surely as I've not earnt my personal allowence yet I'm not taxed UNTIL I do earn it?

Confused...!

middlepuss

I think you're right. If your earnings are below the threshold in the tax year you'll pay no tax. So eg if your only income was £6000 all paid on March 31st you wouldn't pay any income tax.

Gertie_Walker

Your tax liability for this year is £178.20, or £44.55 pm. You will need to contact your tax office as son as you start to inform them about the carers allowance, so that they can put a restriction in your code number to collect this tax.

jem16

DEBTMONKEY1A wrote: »

But surely as I've not earnt my personal allowence yet I'm not taxed UNTIL I do earn it?

Confused...!

Your income for this tax year will be over the personal allowance as you said. However it's not a case of no tax until you hit £6475 and then suddenly getting taxed. Your personal allowance is divided by 12 so that you get part of it each month. Your first salary (and possibly more) will probably not be taxed as you catch up with the allowances from April - October.

However as Gertie says you will need to contact HMRC to get your tax code adjusted to take the Carer's Allowance into account, otherwise you will pay too little tax.

DEBTMONKEY1A

Thanks guys/gals.....so on the p46 best to tick section 'a' (the bit that says you've not had taxable income such as jsa, etc)?

So the tax office will look at what I'm paid Dec-mar 2011 & any tax due for the TOTAL period is divided by the remaining months in the tax year-sorry to be thick-but is this what you mean??

Mikeyorks

DEBTMONKEY1A wrote: »

So the tax office will look at what I'm paid Dec-mar 2011 & any tax due for the TOTAL period is divided by the remaining months in the tax year-sorry to be thick-but is this what you mean??

No - the £6475 personal allowance is allocated monthly (around £540pm). So - at the end December (first pay day??) you will have (9 x £540 £4860 personal allowances available (Apr - Dec) and won't pay tax until your taxable pay catches up with the personal allowance (which will continue to increase at £540 per month.)

But the Carer's Allowance (I'm assuming that has finished) will reduce your Personal Allowance by £1941 ....... to £4534 (£378pm). The P46 doesn't fit to this and you're better ringing HMRC (get the Ref and telephone number from your payroll people) and getting them to issue a fully personalised Code Number direct. But do make it clear the Carer's Allowance isn't continuing - or they're likely to continue to code it out in future years.? Likely code you will get is 453T. If you get that sorted ..... you'll need to rework my first para at £378pm rather than £540pm.

DEBTMONKEY1A

Many many thanks to those that have replied! Mikeyorks-Carers people (& now Housing Benefit) all informed. Carers is paid until i receive my 1st wage at the end of December (a bit of a bonus!). The Carers people can tell me the exact amt. earned-so i can inform the Tax Office. I'll get straight onto it so my 1st wage is ok!!!

Better make the most of the fact that my Tax will be low from Now-March inclusive.....but all extra for the pot!

Thanks again for taking the time & trouble to help me.:beer: