tax on bonus!?

cord123

Hi all!
(sorry in advance if this is a silly question!)
I got my bonus today of £1250 :j I usually earn £1250 on a monthly basis, taking home about £1046 after tax...

this pay day I got £1882... why did I get taxed so much? Is this an ermergency tax that I will get back next month? Do I need to ring th tax office? I would rather have it back as one big sum rather than spread out over a few months.....

Thanks in advance!

shop-to-drop

That sounds about right.

30% (NI+TAX@20%) of 1250 is £375

£1046 + £1250 -£375 = £1891

This rough calculation makes me think you have been taxed correctly.

GGLLOYD

cord123 wrote: »

Hi all!
(sorry in advance if this is a silly question!)
I got my bonus today of £1250 :j I usually earn £1250 on a monthly basis, taking home about £1046 after tax...

this pay day I got £1882... why did I get taxed so much? Is this an ermergency tax that I will get back next month? Do I need to ring th tax office? I would rather have it back as one big sum rather than spread out over a few months.....

Thanks in advance!

You have only been taxed at 20% on your earnings. You'd step into the 40% tax bracket on anything over £2916.66/month or £35,000 per annum.

Your net pay seems perfectly spot on.

cord123

sorry if I am being stupid but why does the bonus get taxed more than my usual salary when they are the same amount.....
GGLLoyd, you said that I had been pushed into the 40% tax bracket by taking home over £2916 in a month but this amount comes to £2500.....

I usually take home £1046 from £1250 salary but my bonus of £1250 I was taxed £420 which seems a lot....? I do apologise if I am totally missing the point just trying to get my head round it.....

somethingcorporate

The first part of your salary is your tax free allowance (£7.7k per annum) so the first £1.25k you are paid has a tax free element. However, when you are paid the extra as you have already used the tax free element for that particular month then the whole additional bonus is taxed at 20%.

maninthestreet

GGLLOYD wrote: »

You have only been taxed at 20% on your earnings. You'd step into the 40% tax bracket on anything over £2916.66/month or £35,000 per annum.

Your net pay seems perfectly spot on.

£1250 per month = £15000 p.a. + £1250 bonus = £16250
This is nowhere near £35000 p.a.

somethingcorporate

maninthestreet wrote: »

£1250 per month = £15000 p.a. + £1250 bonus = £16250
This is nowhere near £35000 p.a.

It's also wrong because they ignored the tax free allowance. Even at £3,500pm you pay no HR tax.

shop-to-drop

I think the point being made to the OP was that someone else who is in the higher tax rate will be paying out half their bonus in tax or 60% for those on supertax. So that he realises that he hasn't had to pay that much tax really he's just not used to paying it as he is normally a low earner and pays very little tax. Also a warning that when he earns more in the future tax will be more of a burden on your pay packet.

Evilm

Having done the figures on Salary Calculator I think they have got it pretty much right:

Looking at the Salary calculator on a yearly basis £1250 a month is £15,000 a year:

Gross Income£15,000.00
Pension Deductions£0.00
Taxable Income£7,525.00
Tax£1,505.00
National Insurance£933.00
Student Loan£0.00
Take Home£12,562.00


Adding in a £1250 bonus that means you earned £16250 this year so:

Gross Income£16,250.00
Pension Deductions£0.00
Taxable Income£8,775.00
Tax£1,755.00
National Insurance£1,083.00
Student Loan£0.00
Take Home£13,412.00

So that seems to be £250 extra tax and £150 extra NI liability for the bonus. Your pay this month should have been approx £1896.83.

thefishdude

basically you can earn so much a year tax free just over 7k. there you only pay tax on whats over that. as you allready earning above your tax free amount anything extra you get ie ya bonus you pay tax on the entire lot. same thing applies to overtime wich is why people moan that more overtime you do more you get taxed.

GGLLOYD

cord123 wrote: »

sorry if I am being stupid but why does the bonus get taxed more than my usual salary when they are the same amount.....
GGLLoyd, you said that I had been pushed into the 40% tax bracket by taking home over £2916 in a month but this amount comes to £2500.....

I usually take home £1046 from £1250 salary but my bonus of £1250 I was taxed £420 which seems a lot....? I do apologise if I am totally missing the point just trying to get my head round it.....

Don't people read? Sorry to sound blunt, but I said - "You have only been taxed at 20% on your earnings. You'd step into the 40% tax bracket on anything over £2916.66/month or £35,000 per annum."