Salary/Tax clarification

dbappa

Wonder if anyone could please help me clarify something with my pay and tax.

I started my current job at the end of last May via the Future Jobs Fund so was paid £6,000 over 6 months. I was led to believe and told that my salary fell below the limit for tax.....
"Re the tax; although you are below the limit for tax, our payroll company’s system isn’t set up to cope with the future job fund. What I have noticed with other FJF staff is that they get deducted a small amount, but that it is repaid when they come off the payroll, at the end of the 6 month period.
PAYE ref is 846 / ZZ50865."


(An email sent to me explaining my situation)


I have been paid £850 (after tax etc) every month after the first month since I started with the tax coming to around £90 and NI approx £60. Obviously the 6 months have long passed and I am still with them (but my salary isn’t been paid by FJF any more) so not off the payroll system. I have tried several combinations of my tax code with the Tax Calculator, some results come out in my favour and others don’t (side note – my tax code in month 1 was 6471). My question is; am I entitled to any form of rebate or not? I have tried asking but never get an answer and I think my WTC will be coming to an end soon so will be in a very sticky situation come April.


Many thanks!

MrsManda

If over the course of the 2010/11 financial year you earn less than £6475 you were not liable for income tax and thus will get a rebate at the end of the financial year.

If you earned more then £6475 but less then £100,000 then you will have had to pay income tax on the whole amount minus £6475 but still may be eligible for a rebate.

It sounds like you are eligible for a rebate but how much depends on how much you'll have earned in total this financial year. Taxable income includes JSA if you've claimed that.

dbappa

I believe since last April until this coming April I will have earned the following (before any deductions):

£10,150 - work
£1,900 - WTC (estimate)
£750 - JSA

£12,800

After deductions:

£8,600 - work
£1,900 - WTC (estimate)
£750 - JSA

£11,250

Gas_Powered_Toothbrush

WTC isn't taxable, you can remove that from your calculations.

Mikeyorks

dbappa wrote: »

I was led to believe and told that my salary fell below the limit for tax.....

..... only if that was all you earned in the full year. Your personal allowance will be £6475 ..... but that is apportioned throughout the year.

Based on your estimated figures of £10900 taxable income (JSA is taxable - WTC isn't) :

Income £10900 less £6475 personal allowance = £4425 taxable at 20% = £885 tax payable over the year.

Your 'after deductions' figure will include NI etc? Which can vary each month, depending on pay, as it isn't a cumulative figure.

dbappa

Thanks for the replies

Yes I get taxed on a monthly basis - breakdown of my first pay slip

June:
Monthly basic: £1,000
Extra back pay £145.83 (as I started in the last week of May - though if it is £1,000 a month I am not sure how it can be £145 for that extra week even after deductions)
Total June: £1145.83

Tax: £121.00 (10.55%)
NI: £73.81 (6.44%)

Net £951.02 (83% of gross)


July:
Monthly basic: £1,000
Total July: £1,000
Tax: £92.00 (9.20%)
NI: £57.53 (5.75%)


Net £850.47 (85% of Gross)

I have received the £850.47 every month after last June so that works out at between £900-950 paid in tax. Looks like it is about right then L. Oh well, thanks for your help though.

Mikeyorks

dbappa wrote: »

July:
Monthly basic: £1,000
Total July: £1,000
Tax: £92.00 (9.20%)
NI: £57.53 (5.75%)


Net £850.47 (85% of Gross)

If you want to work it out monthly. The personal allowance of £6475 is allocated at (£6475 / 12 £540 approx.

£1000 gross less personal allowance £540 = £460 taxable. At 20% that is £92. Which is spot on with your July example?

dbappa

Yes spot on. Looks like I may have been wrong about WTC stopping soon anyway, I thought they followed the tax year and not their own (June/July). Hopefully come May/June, my salary should jump up a fair bit

chrisbur

From the figures that you have given it looks to me as if you may be due a small tax rebate, if your first wage was paid in month 3. I believe that you are currently on the emergency code on a month 1 basis. Have a look at your payslip if you are on emergency code it should have something like X 1 or non-cumulative after the code.
Is the unemployment benefit showing on your payslip, as previous gross, and included in the taxable gross?
Did you get a P45 from the jobcentre, if so what were the figures in sections 7 and 8?