new to PAYE - tax seems a lot!

wallofbeans

I've been working freelance self employed and paying my own tax for a number of years. I have just switched to my main job being a PAYE position, and while I will still do a little freelance it won't be very much and the PAYE job is now my main income.

I just got my first paycheck and I hoped somebody could help me understand my tax and NI position.

It says my TAX CODE is "BR / 0" and my NI CODE is "D".

Are these correct? I'm not sure if the NI they've taken is high but the tax seems like a lot and what I have ended up taking home is less than I thought.

HappyMJ

BR means you pay tax on all of your income. When HMRC notifies your employer of your actual tax code you'll then get the tax back in future pay packets. If they don't get that by April you can claim the money back from HMRC yourself.

wallofbeans

HappyMJ wrote: »

BR means you pay tax on all of your income. When HMRC notifies your employer of your actual tax code you'll then get the tax back in future pay packets. If they don't get that by April you can claim the money back from HMRC yourself.

Can I get them to hurry up and do that? And how do I figure out what I should be getting per month? I'm trying to figure out my budget and this isn't helping...

wallofbeans

blondebubbles wrote: »

Did you complete a starter checklist (similar to P46)?

The NI category D means you are in a contracted out pension scheme - https://www.gov.uk/national-insurance-rates-letters/category-letters

I filled in something but I didn't have a P45 or anything as I came from being self-employed...

I am part of a pension scheme so that makes sense I guess.

chrisbur

On the starter form there would have been something along the lines of ....
A – This is my first job since last 6 April and
I have not been receiving taxable Jobseeker’s
Allowance or taxable Incapacity Benefit
or a state or occupational pension.
OR
B – This is now my only job, but since last 6 April
I have had another job, or have received
taxable Jobseeker’s Allowance or Incapacity
Benefit. I do not receive a state or
occupational pension.
OR
C – I have another job or receive a state or
occupational pension.

Which option did you select as being on code BR would suggest you selected option C which does not seem to be the correct choice from what you have said.

wallofbeans

chrisbur wrote: »

On the starter form there would have been something along the lines of ....
A – This is my first job since last 6 April and
I have not been receiving taxable Jobseeker’s
Allowance or taxable Incapacity Benefit
or a state or occupational pension.
OR
B – This is now my only job, but since last 6 April
I have had another job, or have received
taxable Jobseeker’s Allowance or Incapacity
Benefit. I do not receive a state or
occupational pension.
OR
C – I have another job or receive a state or
occupational pension.

Which option did you select as being on code BR would suggest you selected option C which does not seem to be the correct choice from what you have said.

Yes, there was something like that and I probably did go for C as I do have other jobs - like I said I work freelance a little still. It didn't ask if the other jobs were my main source of income, if it had I would have said no!

Savvy_Sue

A phone call to HMRC should sort this out.

chrisbur

Best to contact HMRC explain you opted for C but that your main income is from your PAYE job. You should then get a 1060L cumulative code (assuming your job has no taxable benefits) and then when you do your self assessment you will need to fill in the employment pages and remember there will be tax to pay on your self employed earnings.

wallofbeans

Should I have chosen a different option? I went for the one that was closest to my situation but now know it wasn't quite right. It seems to me that they need more options!

jem16

wallofbeans wrote: »

Should I have chosen a different option? I went for the one that was closest to my situation but now know it wasn't quite right. It seems to be that they need more options!

I would have thought option A as technically it's PAYE jobs they are interested in.

However I can see why you went for C.

wallofbeans

jem16 wrote: »

I would have thought option A as technically it's PAYE jobs they are interested in.

However I can see why you went for C.

If that's the case, they should've mentioned it. Also, I filled in that form with advice from the HR department of my new job so surely they should have pointed all this out... no helpful at all!