Taxable pay question

LEP

This might seem like a daft question but for tax payment purposes HMRC take into account ‘Taxable Pay to Date’ rather than ‘Gross Pay to Date’ at the year end with regards to my salary?

To explain I have a Balances section on my payslip with two separate entries: ‘Taxable Pay to Date’ and ‘Gross Pay to Date’ .

The second does not take into account £125 I pay per month into company share incentive scheme. I pay no tax or ni on this but for some reason this gets deducted after my other deductions are removed i.e. my pension (salary sacrifice) nd childcare vouchers get dedcuted from my gross pay to give me one gross pay figure then for some reason the £125 gets removed from this gross pay figure along with my NI and PAYE to give me my net pay.

Basically my Gross pay figure for the year is higher than the Taxable pay figure and I have other income I need to declare via self assessment. I basically don’t want to go over the 40% threshold.

I think I am worrying about nothing….but can some ease my ‘fears’

Thanks

CLAPTON

LEP wrote: »

This might seem like a daft question but for tax payment purposes HMRC take into account ‘Taxable Pay to Date’ rather than ‘Gross Pay to Date’ at the year end with regards to my salary?

To explain I have a Balances section on my payslip with two separate entries: ‘Taxable Pay to Date’ and ‘Gross Pay to Date’ .

The second does not take into account £125 I pay per month into company share incentive scheme. I pay no tax or ni on this but for some reason this gets deducted after my other deductions are removed i.e. my pension (salary sacrifice) nd childcare vouchers get dedcuted from my gross pay to give me one gross pay figure then for some reason the £125 gets removed from this gross pay figure along with my NI and PAYE to give me my net pay.

Basically my Gross pay figure for the year is higher than the Taxable pay figure and I have other income I need to declare via self assessment. I basically don’t want to go over the 40% threshold.

I think I am worrying about nothing….but can some ease my ‘fears’

Thanks

it's normal to have both 'gross' and 'taxable' if you pay anything before tax e.g. pension, salary sacrifice etc as these are tax free

I don't understand the details you haven't given but it looks as if your share save come from after tax pay i.e. are a deduction from net pay which seems correct

LEP

I pay no tax or NI on this share incentive scheme. I have worked this out.

Here is an example of last pay slip

Gross pay 3122.0

from this I have deductions of:

Childcare vouchers 243
Pension 489.88

I then get a Gross pay figure of:

2389.13

from this I have deductions of :

NI A 194.17
PAYE 295.2
Share incentive plan 125

giving net pay of 1774.76

This net pay figure is the equivilant of a 'real' gross pay figure of 2264.13 which is my initial gross pay figure minus £125....so I can not payinG tax or NI on this £125

I then have a balances section at the end of my payslip which lists:

Taxable Pay to Date
and
Gross Pay to Date

The gross pay figure takes into account the fact my pension/ccv have been 'removed' but not the share incentive money.....the taxable Pay to Date takes into account pension/ccv + share incentive have been 'removed'.


It just seems very odd to me......but my general question is that HRMC will only be using the Taxable Pay to Date figure I see.

CLAPTON

LEP wrote: »

I pay no tax or NI on this share incentive scheme. I have worked this out.

Here is an example of last pay slip

Gross pay 3122.0

from this I have deductions of:

Childcare vouchers 243
Pension 489.88

I then get a Gross pay figure of:

2389.13

from this I have deductions of :

NI A 194.17
PAYE 295.2
Share incentive plan 125

giving net pay of 1774.76

This net pay figure is the equivilant of a 'real' gross pay figure of 2264.13 which is my initial gross pay figure minus £125....so I can not payinG tax or NI on this £125

I then have a balances section at the end of my payslip which lists:

Taxable Pay to Date
and
Gross Pay to Date

The gross pay figure takes into account the fact my pension/ccv have been 'removed' but not the share incentive money.....the taxable Pay to Date takes into account pension/ccv + share incentive have been 'removed'.


It just seems very odd to me......but my general question is that HRMC will only be using the Taxable Pay to Date figure I see.

it would seem that your share save is via salary sacrifice and so yes HMRC will use the taxable pay to date figure
if you were in the scheme last tax year you could check your P60 figure

LEP

I wasn't in it last year......as long as HMRC just use the taxable pay to date figure I will not breach the 40% limit when my other income is taken into account.

Thanks for you help...thought I was worring about nothing.

CLAPTON

LEP wrote: »

I wasn't in it last year......as long as HMRC just use the taxable pay to date figure I will not breach the 40% limit when my other income is taken into account.

Thanks for you help...thought I was worring about nothing.

Check you P60 at year end carefully

however, I'm not sure why you are worrying about 40% tax : although unwelcome it's good to be earning sufficient to pay it