Help me with tax deducted please?

Chucky1234

Hi all.

Apologies if this is the wrong forum but it seems the best match.

Started a new job mid way through this month and my deductions were a lot higher than expected. Haven't got my payslip to hand but could have a quick look at it at work with the payroll lady.

I get £7.93 an hour, work 8 hours a day and worked 14 days last month. My basic pay therefore was £888.16. This is what it shows on my payslip.

My net pay was £690.72. This means I have had £197.22 of deductions.

My tax code is 800L.

To clarify;
Gross pay - £888.16
Deductions (don't have the split between NI and PAYE) - £197.22
Net pay - £690.72.


I have tried working it out and I get;

NI deducted
£106.57 (12% of £888.16)


PAYE deducted
My tax code gives me £666.67 personal allowance per month, this leaves me with £221.45 taxable income at 20%.

This means I should have £44.29 deducted.

Therefore I have paid £46.36 too much income tax?

Can somebody please have a look at those figures as there may be a good reason for it but I don't have a clue.

PS: No salary sacrifice, no pension contributions, no student loan or anything else that could affect this.

xylophone

Did you give the new employer a P45?

http://taxaid.org.uk/guides/taxpayers/tax-for-employees/changing-jobs-and-new-employments

Why is your tax code so low?

https://listentotaxman.com/

Chucky1234

My tax code is 800l as I have another job where I work part time different hours each week. As my old job I used to get around 8,000 per year net pay so split my tax code accordingly.

I handed my P45 to my new employer yeah. Will update with figures tomorrow.

ETA: The lady who does our payroll says I had around £170 income tax deducted which makes sense as you said £25.94 NI is due. £170 is not far off 20% of my net pay, so it looks like I may have been taxed on all of it?

booksurr

Chucky1234 wrote: »

ETA: The lady who does our payroll says I had around £170 income tax deducted which makes sense as you said £25.94 NI is due. £170 is not far off 20% of my net pay, so it looks like I may have been taxed on all of it?

NI is applied to each payment you get in isolation. that means you get a tax free element for every job you have and every time you get paid you get the same amount tax free no matter how many jobs you have. So, if you are paid monthly, the first £671.67 per job per month is free of NI, hence in your case 888.12 - 671.67 = 216.45 @ 12% = 25.97 NI to deduct from that job

income tax works differently. It takes the total you have been paid for the whole year to date and works out how much tax you should pay on that. It then deducts the total tax you have already paid year to date and the difference is the amount of tax you must pay that month

where you change jobs mid month, and are therefore paid by 2 employers in the same month your tax free allowance is "used up" by the first employer. It is not a tax free amount per job, it is simply a set amount for the year to date and so is used up as soon as your pay exceeds that amount.

so in your case your old employer used up your tax free allowance for the year to date when they paid you your final pay. Your new employer therefore taxed you 888.12 @ 20% = 177.62 as you had no tax free amount left for them to use in your new job

your net pay was therefore 888.12 - 25.97 - 177.62 = 684.53 approximately (the HMRC system rounds figures in a slightly different manner)

So that means you have paid the correct amount of tax this month ASSUMING that your final pay from your old job was paid on/after 1st Sept and the gross pay was more than £666.66. Given you have a tax code of 800L you get approx £666.66 free of income tax per month (code 800 means: 8000/12 = £666.66 approx per month). Note tax free pay also works on a cumulative basis so it is not always exactly that each month in isolation

Chucky1234

booksurr wrote: »

So that means you have paid the correct amount of tax this month ASSUMING that your final pay from your old job was paid on/after 1st Sept and the gross pay was more than £666.66. Given you have a tax code of 800L you get approx £666.66 free of income tax per month (code 800 means: 8000/12 = £666.66 approx per month). Note tax free pay also works on a cumulative basis so it is not always exactly that each month in isolation

Thanks for your help. My final gross payment from my old job was £231, however I had around £80 tax refunded on that too meaning my net payment was £310. Is that still correct?

chrisbur

To clarify this the following details are required. You need to quote the exact figures and details as they appear on your P45 and your first payslip from your new employer.

P45
From part 1A what appears in section
6. tax code at leaving, include the code and is there an X after the code.
7. Last entries on deductions week or month number, total pay to date and total tax to date. May be blank if so confirm this.
8. This employment pay,total pay and total tax again may be blank.

Payslip
Taxable gross, tax paid, tax code that appears on the payslip, taxable pay to date and tax paid to date. Also week or month number.

sheramber

MONTH'S INCOME 231 + 888 = 1119 LESS ALLOWANCE 666 = 453 @20% = 90.60

But you had rebate of £80 so tax now due is 90.60 + 80 + 170.60

Chucky1234

sheramber wrote: »

MONTH'S INCOME 231 + 888 = 1119 LESS ALLOWANCE 666 = 453 @20% = 90.60

But you had rebate of £80 so tax now due is 90.60 + 80 + 170.60

Think you are right actually. Thank you.

I will give the exact figures when I receive my payslip and P45 back tomorrow.