new tax code means I'm £180 a month worse off

mathewckent

Hi

Can some body help me understand how my new tax code from April 2012 onwards means that I'm now £180 a month worse off than what I was in March 2012?

Up until March my tax code was 747L but from 1 April it is now 820L. I've just received my payslip for the month of April and I'm £180 worse off now.

My interpretation of the new tax code was that my personal allowance has increased which means that I can earn a higher amount of money before I start paying tax.

I'm really shocked and confused. Can someone enlighten me?

Many thanks!

ktothema

Without asking you to disclose your income, is it possible that you have also gone into the higher tax bracket? I believe the threashold for this decreased this year as well as tax free allowance going up.

chrisbur

Without figures no one can help you.

You need to give for last year your total taxable gross and the tax paid, as well as taxable gross and tax paid for March and February, then for this year taxable gross and tax paid for April.

Andy_L

Are you a public sector worker & your pension contributions have gone up at the same time?

KiKi

Your tax code *should* leave you better off - unless, as other people have said, you have new circumstances such as higher pension contributions, new taxable benefits (do you get any company benefits that you haven't had before?).

We need figures of last month's payslips and this month's one to help you.

KiKi

somethingcorporate

KiKi wrote: »

Your tax code *should* leave you better off - unless, as other people have said, you have new circumstances such as higher pension contributions, new taxable benefits (do you get any company benefits that you haven't had before?).

We need figures of last month's payslips and this month's one to help you.

KiKi

Would new taxable benefits not be reflected in the tax code?

It does seem odd and is probably an increased pension contribution or an error.

McKneff

I thought the new tax code should be 810L the OP says his is 820L or was that a typo

McKneff

It gets to be very confusing when you have 2 threads going asking for the same advice.

KiKi

somethingcorporate wrote: »

Would new taxable benefits not be reflected in the tax code?

It does seem odd and is probably an increased pension contribution or an error.

Yes - der. Senior moment (very early senior moment, I might add) that I must be having.

Bigmoney2

I seem to recall that the point at which 40% tax becomes payable was reduced at the same time as the persoal allowance increased. Is it possible that some of your pay has now come into this tax bracket?

I don't remember the exact figures as it doesn't effect me so didn't pay too much attention to it.

jem16

Bigmoney2 wrote: »

I seem to recall that the point at which 40% tax becomes payable was reduced at the same time as the persoal allowance increased. Is it possible that some of your pay has now come into this tax bracket?

Last year it was £42,475 ( assuming no reduction in tax code for benefits in kind) before reaching higher rate tax and this year it is £42,475. No change in that respect so that will not be the difference.

From the OP's other thread about the same thing, it looks more likely that March's tax was lower as a result of something else that happened during the tax year - possibly a bonus payment at some point that saw some tax being taken at 40% which was then refunded in March, hence the lower March payment than normal.

https://forums.moneysavingexpert.com/discussion/comment/52784421#Comment_52784421