PAYE tax question

LEP

From April I will be paid for about 6 months work a monthly wage that pro-rata would take me into the 40% tax bracket if I were paid if for the whole tax year.

However after 6 months my wage will fall significantly and by the year end I will have earnt about 41k - so below the 41,450 threshold for the whole year.

Question is - for the those first 6 months will I be taxed at 40% on anything above £3454?

If so how does a rebate work as for the whole tax year by earnings will be below the 40% threshold?

Thanks

zagfles

Yes you'll pay 40% on earnings above the HRT threshold, but you'll get refunded during the rest of the year so it will all work out correct in the end. You'll just see less tax going out when your pay drops.

In fact you'll be better off than if your earnings were spread evenly over the year, since you'll pay less NI!