Am I getting taxed incorrectly?

Istanbul05_2

Hi!

I am just putting this out there to any experts before I take the matter up with the HMRC as I may be completely wrong. I just cannot get my head around why I am getting taxed so much.

I earn £21000 per annum and £1750 per month. On top of this I am paid £300 car allowance per month and £23 phone allowance per month (both taxable at 20%) taking my total monthly income to £2073.

How much should I be getting taxed per month?

Personally I think my tax code should be 1060L and then I should be getting taxed on my standard salary plus my two allowances, or my tax code should be 687L and I should get taxed on just my salary. As it happens, my tax code is 687L and I am getting taxed on my salary and my allowances which amounts to £300 per month. Feels as though I am basically being taxed on my allowances twice as things stand.

agrinnall

Well, assuming you are on the standard tax code of 1060L and you're not making any pension contributions then your monthly tax would be £237.93 and NI £168.16.

http://www.thesalarycalculator.co.uk/salary.php

Istanbul05_2

agrinnall wrote: »

Well, assuming you are on the standard tax code of 1060L and you're not making any pension contributions then your monthly tax would be £237.93 and NI £168.16.

http://www.thesalarycalculator.co.uk/salary.php

Please see the edit I have made to the original post

I am not making any pension contributions.

Istanbul05_2

Anyone??

Guest101

Your total salary is £24876 ?

Istanbul05_2

Guest101 wrote: »

Your total salary is £24876 ?

Including the allowances, yes.

Guest101

Istanbul05 wrote: »

Including the allowances, yes.

So you should get either £1,666.91 a month (if taxed on the whole amount)


£1382.67 (which I presume is what you take home now?)


£1602.31 - which is what you should be taking home.


However you need to speak to payroll really to work out which method they're using.

Darksparkle

Why is the tax code 687L?

Istanbul05_2

Guest101 wrote: »

So you should get either £1,666.91 a month (if taxed on the whole amount)


£1382.67 (which I presume is what you take home now?)


£1602.31 - which is what you should be taking home.


However you need to speak to payroll really to work out which method they're using.

Here are the figures from my latest payslip:

Salary - £1750
Car Allowance - £300
Phone Allowance - £23

Tax - £300
NI - £168
Student Loan - £56

Tax home pay - £1549

My thinking is that I shouldn't be getting taxed on my allowances when my tax code has already been reduced to account of them.

Darksparkle wrote: »

Why is the tax code 687L?

I always presumed is was reduced because of the allowances, but I'm not sure.

Guest101

Darksparkle wrote: »

Why is the tax code 687L?

£3730(ish) benefits deducted from 10,600 = 6870 (L) personal allowance.


Which is certainly one way to work it out.

Darksparkle

Guest101 wrote: »

£3730(ish) benefits deducted from 10,600 = 6870 (L) personal allowance.


Which is certainly one way to work it out.

But the benefits are £3876.

OP did you not receive a coding notice from HMRC?

Easiest thing to do would be to get the code changed back to 1060L. The employer can then tax the total income and benefits as they should.

How many mobiles have you been given? If only one and the contract is between the employer and supplier it isn't taxable.