Started job end of tax year.

LoopDC

Hi there

I finished university this year and had a part time job from July to September where I earnt around £2,250. I have now started a new full time role which pays £18,000 a year. With a pay rise in December to £2,000 and another in June 2017.

I will be paid full amounts in October to April and half of September. Meaning I'll earn around £12,000 by April and £13,500 with April included.

I'm paying around £120 tax a month. Which is fine if I started this job in the new tax year. But for 16-17 tax should I be getting a tax refund come April? As I will only be earning £12,000 in the tax year?

How does this work? And how do I claim it back if that's the case? Thanks
DC

molerat

Did your old employer give you a P45 when you left ? What tax code were you on in the old job and what are you on now ? If things run correctly PAYE will ensure you pay no more or less tax than what is due.

LoopDC

Hi molerat,

Yeah I got my P45 in the post today, I'm on 1100L I believe, P45 isn't in front of me. If I was earning £12k I'd pay around £700 whereas with £18k I'd pay around £2.5k in tax/NI so how does this work to make sure they have it correct?

Dazed_and_confused

NI is worked out each pay day and what happened in the past is irrelevant 99.99% of the time.

Tax will be calculated correctly if your code is correct and new employer takes into account the previous earnings (and tax) on the P45 you will now hand over to them. Expect low or no tax to start with (due to your low average salary so far this tax year) and it will increase over the next few months as you become seen by the PAYE system as a basic rate payer.

chrisbur

All will be sorted provided that the tax code on the P45 is a cumulative code. To check this have a look at part 2 of the P45 which if it is cumulative will not have an X after the 1100L and will have details of your earnings in your old job showing on it. If tax code is not cumulative will take a bit longer as HMRC will have to advise your new employer of the details.

CLAPTON

LoopDC wrote: »

Hi molerat,

Yeah I got my P45 in the post today, I'm on 1100L I believe, P45 isn't in front of me. If I was earning £12k I'd pay around £700 whereas with £18k I'd pay around £2.5k in tax/NI so how does this work to make sure they have it correct?

what tax code is on your latest payslip?

LoopDC

Dazed_and_confused wrote: »

NI is worked out each pay day and what happened in the past is irrelevant 99.99% of the time.

Tax will be calculated correctly if your code is correct and new employer takes into account the previous earnings (and tax) on the P45 you will now hand over to them. Expect low or no tax to start with (due to your low average salary so far this tax year) and it will increase over the next few months as you become seen by the PAYE system as a basic rate payer.

expecting low or no tax, but how do I work out what I am meant to be taxed, it seems that I am being taxed the same amount as a friend of mine who has earned £20,000 salary for the year, compared to my lowly £2,244 this year so far. Surely I shouldn't of paid any tax yet?

chrisbur wrote: »

All will be sorted provided that the tax code on the P45 is a cumulative code. To check this have a look at part 2 of the P45 which if it is cumulative will not have an X after the 1100L and will have details of your earnings in your old job showing on it. If tax code is not cumulative will take a bit longer as HMRC will have to advise your new employer of the details.

CLAPTON wrote: »

what tax code is on your latest payslip?

My tax code is 1100L on my P45, I haven't received a pay slip for my new position yet, I shall receive one within the coming week.

Main concern is how do I actually know what I should be getting taxed? I can find out what I'm being taxed, and if I have been paying to much tax how do I go about getting it back?

Funnily enough, I have just looked at my P45 and it says total pay to date, £2,244.50 and total tax to date £0, although I have a payslip clearly showing me pay tax :T

Also just an additional question so that it can be answered, if I am now earning £1,500 before tax. Will I be paid £1,500 next month instead of the £1,283 due to my income so far this tax year?

Dazed_and_confused

Try using this link or listentotaxman website
http://payecalculator.hmrc.gov.uk/PAYE0.aspx

You are probably on emergency tax code at the moment, you will only notice the difference when your new employer uses the information from your P45.

Excess tax deducted in this tax year will be repaid by your new employer the first time you are paid after they have used your P45 from the old employer.

Think carefully before challenging your old employer about the P45. You may have paid tax one pay day and it could then have been refunded at a later date, just as you are hoping will happen with your new job. The total tax to date on your P45 may well be correct.

Do not expect to get £1500, it will either be £1500 less tax or £1500 plus tax refund.

You need to add your expected wages at the end of October to anything already paid by new company, expected wage at end of November and the 2244.50 paid in old job. This gives you your total salary to month 8 of the tax year. Convert this to an annual figure and if this is less than £11000 then no tax is due at end of November pay day and you will get any tax deducted by new employer back. Repeat process each month to see what tax is due. You will find your "annual" pay calculation increases as each month passes because you are now earning much more (£1500 per month) than you were for the first few months of the year (£2244 in first 5 months or so)

chrisbur

LoopDC wrote: »

expecting low or no tax, but how do I work out what I am meant to be taxed, it seems that I am being taxed the same amount as a friend of mine who has earned £20,000 salary for the year, compared to my lowly £2,244 this year so far. Surely I shouldn't of paid any tax yet?





My tax code is 1100L on my P45, I haven't received a pay slip for my new position yet, I shall receive one within the coming week.

To know what is happening to your tax you need to give full details from the P45. From part 1A is there an X after the tax code of 1100L? There is then a section Total pay to date and Total tax to date followed by Total pay in this employment and Total tax in this employment. What appears in each of these?

LoopDC

Dazed_and_confused wrote: »

Try using this link or listentotaxman website


You are probably on emergency tax code at the moment, you will only notice the difference when your new employer uses the information from your P45.

Excess tax deducted in this tax year will be repaid by your new employer the first time you are paid after they have used your P45 from the old employer.

Think carefully before challenging your old employer about the P45. You may have paid tax one pay day and it could then have been refunded at a later date, just as you are hoping will happen with your new job. The total tax to date on your P45 may well be correct.

Do not expect to get £1500, it will either be £1500 less tax or £1500 plus tax refund.

You need to add your expected wages at the end of October to anything already paid by new company, expected wage at end of November and the 2244.50 paid in old job. This gives you your total salary to month 8 of the tax year. Convert this to an annual figure and if this is less than £11000 then no tax is due at end of November pay day and you will get any tax deducted by new employer back. Repeat process each month to see what tax is due. You will find your "annual" pay calculation increases as each month passes because you are now earning much more (£1500 per month) than you were for the first few months of the year (£2244 in first 5 months or so)

Thanks, I'll have a mess around with that when I get a chance. It makes no sense to me at first glance. It says "Tax due at end of current period: £0.00" meaning if everything was input correctly, I will pay £0 on my income for October? meaning my net income is?

I am afraid to ask this question, but I am receiving a pay rise of a few £k come december, as well as due bonuses, at the moment I know of a £200 bonus come November pay, plus potentially a larger bonus coming the month after.

I use the tax home calculator, but this obviously tells me from an annual income, so doesn't adjust for previous.

chrisbur wrote: »

To know what is happening to your tax you need to give full details from the P45. From part 1A is there an X after the tax code of 1100L? There is then a section Total pay to date and Total tax to date followed by Total pay in this employment and Total tax in this employment. What appears in each of these?

No X. £2244.5 and £0. This means?

chrisbur

LoopDC wrote: »

No X. £2244.5 and £0. This means?

I assume that these figures are in the Total pay to date and Total tax to date and that the Total pay and Total tax in this employment are blank.

If these details are applied for your payday for month 7 which is your payday that falls anywhere from October 6 to November 5 you will have a tax free allowance of £6422.01. If your earnings at that point are below this figure, which from the details given looks like being the case, then any tax you have paid so far in your new employment will be refunded to you.
Each month after that your tax free allowance will be increased by £917.43 and if your total earnings for the year are lower than that figure no tax will be due and when your total earnings for the year are over that figure you will start to pay tax.