New Tax code 2014/15

zygurat789

Your monthly tax last year was £582 on an average salary of £3575
This year the figures are £419 and £2979.

The answer will be in last years tax codes or when your salary dropped from over £3535 to less than £3000.

You will need to look at all your payslips for last year

Crossed with your post!

f1racer

Still don't understand it - my tax from last year is upto date - i don;t owe anything. no under of over payments. i earn the same earning 96 quid odd less a month is a bit steep - thats all.

f1racer

Hi, yes i know thank you for all your answers and efforts. Having it comfirmed just makes it hurt a little more:)

Can one claim asylum in ones own country? Do a reggie perrin at one beach - swim to the next ....

xylophone

Have you thought about increasing your pension contributions?

http://www.pruadviser.co.uk/content/support/technical_centre/pension_tax_planning/

chrisbur

f1racer wrote: »

Mar - £2929 tax 323
Feb - £2929 tax 323
Jan - £2929 - tax 323
Dec - 2929 - tax 323
NOv - 2929 - tax 323
OCT - 2929 tax 323
Sep - 2929 tax 323
Aug - 2929 tax 323
Ah now it gets interesting

Overtime months
July - 4479 - tax 942.90
june - 4479 - tax 942.90
may 4479 - tax 942
April 2929 tax 323

As has been said these figures do not appear to agree with the annual figures. Check April for a start (I am assuming that they are in reverse order and April here is April 2013.
However the general idea is there and apart from April explains what has happened to your tax. First it is correct based on your annual figures given earlier and the simple answer is as I said earlier you paid a fair bit of tax at 40% in May June and July; also probably April. As the tax year progressed and your earnings went down you started to get some of this 40% tax reduced to 20% tax and this reduction lowered your tax each month, so that by the year end you had paid the correct amount.
To put a bit more detail on it (figures are approximate to keep the maths simpler) you get at month 1 £787 no tax and £2668 at 20% then pay 40%, month 2 these double month 3 treble and so on.
So on £4479 you get £787 nothing due £2668 20% due £533 and the rest £1024 gets 40% due £410 so tax is £533 plus £410 = £943.
Then your earnings go down to £2929 which now means that whereas before you were over the 40% threshold by £1024 you are now under it by £526 each month. Tax on £2929 for someone who had not been earning enough to pay any 40% tax so far would be £2929 less £787 non-taxable to give taxable of £2142 which at 20% would be £428. But you are now under the 40% band by £526 and you did pay 40% tax so are due some of that back. £526 now moves from 40% tax to 20% tax so you get 20% of it back that is £105 so you pay £428 - £105 which is £323.
The fact is your tax did not go up this April it went down last August on-wards.

zygurat789

f1racer wrote: »

Mar - £2929 tax 323
Feb - £2929 tax 323
Jan - £2929 - tax 323
Dec - 2929 - tax 323
NOv - 2929 - tax 323
OCT - 2929 tax 323
Sep - 2929 tax 323
Aug - 2929 tax 323
Ah now it gets interesting

Overtime months
July - 4479 - tax 942.90
june - 4479 - tax 942.90
may 4479 - tax 942
April 2929 tax 323

PAYE for Apruil 2013 Gross £2929 would have been £428.20.
To help further, what were your tax codes for these months, including any/all characters after the L and is there anything else on the payslip apart from PAYE and NI?
I just don't see how the tax could be static after July 2013 unless there is a month 1 code.

chrisbur

zygurat789 wrote: »

PAYE for Apruil 2013 Gross £2929 would have been £428.20.
To help further, what were your tax codes for these months, including any/all characters after the L and is there anything else on the payslip apart from PAYE and NI?
I just don't see how the tax could be static after July 2013 unless there is a month 1 code.

The OPs figures do not add up to the yearly totals given earlier so some are certainly wrong and I suspect a bit rounded as well (so odd 20p or 40p variation may have been missed out ); but looking at the general trend they are consistent with a cumulative tax code taking some 40% tax in the early part of the year and then returning part of that 40% tax to convert it to 20% tax for the August on-wards payments.