Tax Advice

KarlWalsh

My question is less to do with cutting tax, but I wasn't sure where to post:o

I left the UK in February 2010 to travel the world, and returned in December. I have just landed a new job, hopefully starting on Monday:j

I haven't earned anything since last April, so my income up until this April will be £8124.99 with a taxable income of £6506.25 (According to listentotaxman.com)

In a normal year, that would be a tax payment each month of £433.75, for three months that's £1301.25.

For an entire year my tax-free amount is £6475, therefore my three months earnings(£8124.99) minus this amount is £1649.99 which is my actual taxable amount for the year. At 20% that's a total tax of £329.99.

That's a difference of £971.26 if I pay the £433.75 each month.

Will I need to claim this back after April? Or will they perhaps make assumptions on my salary and reduce the monthly tax?

It's not majorly important, but I'm trying to allocate money to pay off debts etc etc. If I have to wait that's fine, but nice to know before hand.

Many thanks.

KarlWalsh

Anyone able to answer my question.

To clarify a bit in-case I wasn't clear enough. Will I pay £433.75 tax a month until after April, at which point I can claim £971.26 back or will I be taxed based on my assumed salary and pay less per month meaning I don't have to claim after April?

CLAPTON

yes you should only pay the lesser sum (listentothetaxman doesn't work very well unless you work for a full year)

how what actually happens depends upon what tax code your employer uses for you
did you fill in a P46 when you started?
if they put you on the correct code 647L then the lower tax will be collected and you will not have to reclaim the money but if they use 647L M1 (or something similar) or even BR then you will need to claim at year end unless you get them to change the code next month

KarlWalsh

Thanks CLAPTON, that's just what I was looking for.

I haven't finished all the paperwork yet so no, but now I know how the codes work I'll make a point of checking.

CLAPTON

if you are starting on Monday then there is only two months pay that's part of this tax year ..Feb and March

KarlWalsh

CLAPTON wrote: »

if you are starting on Monday then there is only two months pay that's part of this tax year ..Feb and March

Sweet, zero tax for two months:j