Tax band help

onlyroz

Could somebody please help me figure out whether I will be in the higher 40% tax band in 2012/2013?

My basic salary is £39400. On top of this I receive a £2600 bonus.

I receive private medical insurance worth around £1800 a year, which reduces my personal allowance.

I pay a 5% pension contribution.

I receive child-care vouchers of £243 a month.

Many thanks in advance.

anselld

When you say "receive child-care vouchers" do you mean as a free benefit or do you have to pay for them out of salary?

Is the £2600 bonus pensionable?

onlyroz

child care vouchers are a salary sacrifice arrangement, so it gets deducted from my gross pay before the income tax is calculated.

And yes, I think the bonus is pensionable.

anselld

onlyroz wrote: »

child care vouchers are a salary sacrifice arrangement, so it gets deducted from my gross pay before the income tax is calculated.

And yes, I think the bonus is pensionable.

In that case you should be OK ...

Income
Salary 39400
Bonus 2600
Med 1800
Total 43800

Allowances
Personal 8105
Pension 2100
Child Care 2916
Total 13121

Taxable 30679
(Higher rate starts at 34370)
.

onlyroz

Many thanks.

It does look like I'll go over the limit once I stop using the childcare vouchers (i.e. when my daugher starts school) and so when that happens I'll probably be in danger of losing the child benefit - so a rethink of pension contributions might be in order in a year's time...

anselld

You might still be OK. Plus they are still talking about the child benefit; it might yet change in the budget.