Higher Rate Of Tax?!?!?!?

vindalooloo

Hi all,

I work in a shop and bring home about £350 a month in. Obviously this is no where near what I need to be earning with our present debt probs.

Just started my second job, which I guess will fetch in around another £300 - £400 a mont. Hovever was speaking to someone the other day who tells me they pay higher rate tax on their second job!

This will mean that taking on the extra job to try to earn a bit more I will be *well* penalised. :mad: Higher rate is 40% I think. Even with both jobs added together I am on a very low wage. How can they justify penalising you with such a high rate of tax when you are struggling so take out a second job to alleviate the poor pay you have with yoru first job.

Can anyone tell me if this is the case. That I will be paying the same tax as for a few hours telephone work as a company executive?!?!?!? NOT fair.

vindalooloo

Just thought I'd add that they don't actually tax me on my first job.... I'm probably not earning enough to pay it! 15 hours at week at Nat Min Wage (£5.35)

blushred2

Hi

I have a second job and i am taxed at 22%.

nearlyrich

That's not the case at all, you have a personal allowance for a nil rate and then the taxable rate is stepped from 10% to 40% but you would need to be earning around £27000 pa to pay tax at 40%, it might be more.

I think the confusion arises from the fact that you have 2 employers, I will move this to the Cutting Tax board where the experts can give you the right advice.

clarab_3

40% rate of tax is for anyone over the £33.3k threshold per year.

22% is the standard rate of tax for anyone earning between £2151 and £33.3k

You have a personal allowance that you are allowed to earn before tax comes into play. for most people this is £5035

vindalooloo

Many thanks ... so basically the information I have been given is wrong? Phew. been bricking it wondering if it was going to be worth doing the second job.

Idiophreak

yeah, I'd say it's wrong. Shouldn't pay more than 22%. Not sure how it will work having two jobs though - which of them you'll pay the tax from etc? Maybe half from each? Sure someone will be along shortly that's in the know.

oscar52

If your first job, on a weekly basis takes you over the £5035 threshold (less than £100 a week (96?) then the second job is taxed at 22% AND NI at 11%

vindalooloo

My first job doesn't - my contracted hours are 15 per week at £5.35 = £4173.

I do do an extra day here and there, but it's certainly not going to push me over the threashold over a year I wouldn't have thought.

btloptingout

clarab wrote:

40% rate of tax is for anyone over the £33.3k threshold per year.

22% is the standard rate of tax for anyone earning between £2151 and £33.3k

You have a personal allowance that you are allowed to earn before tax comes into play. for most people this is £5035

Just so this is clear (as I think there's room for confusion)

Earnings...............Tax
£0-£5035...............0% (£0)
£5036-£7185..........10% (£215)
£7186-£40485.........22% (£7325)
£40486 upwards......40%

So a person who earned £40485 would pay £7540 in Income Tax

h4nym

And just to clarify further, it doesn't matter whether you get this money from one employer or several - it's your overall earnings that are taxed at the appropriate rate. This could also, for example, include earnings from interest, rental income over a certain threshold etc etc.

In your case, Vindalooo, I wouldn't expect tax to be a major issue!