Tax on bonus

joshreade

Sorry if this is in the wrong forum category.

My salary is £25,000 which works out £2083.33 before tax.

My tax is £214.00/NI is £96.15. I have worked this out using the income tax calculator on this website and this is correct to the penny.

This month I received my yearly bonus of £750.
Tax for this month was 383.20 and NI is 259.36.

Surely this is too much?

I used the tax calculator again and this time put in a salary assuming I received that same £750 bonus every month, which would bring my salary to £33,999.

The tax and NI on that worked out to be the exact same as what I've paid this month.

Does this mean I'm due a rebate? Otherwise it would be very unfair if I could earn £34,999 a year and pay the exact same as my current wage plus a £750 yearly bonus.

Any help would be greatly appreciated.

Thanks

zagfles

joshreade wrote: »

Sorry if this is in the wrong forum category.

My salary is £25,000 which works out £2083.33 before tax.

My tax is £214.00/NI is £96.15. I have worked this out using the income tax calculator on this website and this is correct to the penny.

That's far too low. I make tax £233.33 and NI £169.36.

What's your tax code?

This month I received my yearly bonus of £750.
Tax for this month was 383.20 and NI is 259.36.

Surely this is too much?

No that looks spot on.

I used the tax calculator again and this time put in a salary assuming I received that same £750 bonus every month, which would bring my salary to £33,999.

The tax and NI on that worked out to be the exact same as what I've paid this month.

As it should.

Does this mean I'm due a rebate? Otherwise it would be very unfair if I could earn £34,999 a year and pay the exact same as my current wage plus a £750 yearly bonus.

It's correct. You don't move through any tax bands, so any marginal extra you earn you'll get taxed on at 20% and NI at 12%. That would apply if the £750 was a one off or every month.

It's only if you move through tax bands it'll make a difference.

martinsurrey

joshreade wrote: »

Does this mean I'm due a rebate? Otherwise it would be very unfair if I could earn £34,999 a year and pay the exact same as my current wage plus a £750 yearly bonus.

Thanks

In the £34,999 example you would be paying the extra tax EVERY month, so you would pay 12 times the additional tax you will (as they should becuase they earn 12X the extra income).

in short you should pay £750*20% = £150 in Income tax on your bonus and £750*12% = £90 NI on your bonus. which you have.

WestonDave

NI works on a monthly basis - extra NI on £750 should be 12% or £90 extra but your normal NI looks low unless there is something strange because you should be paying 12% on anything over £680 per month which I make £168 which would then make your bonus NI look about right.


Tax works cumulatively but in the last month of the year where you've used all your allowances you'd pay 20% of the extra £750 which would be £150 more so the figure looks a touch high.

joshreade

Tax code is 1100L.

NI is £157.82

I read the wrong line of the wage slip.

Its my student loan which is £96.15, which is normally £30, which was going to be my next question, but I'm guessing follows the same principal so I'm guessing that's correct and I will just have to accept the fact my bonus has nearly halved

zagfles

joshreade wrote: »

Tax code is 1100L.

NI is £157.82

I read the wrong line of the wage slip.

Its my student loan which is £96.15, which is normally £30, which was going to be my next question, but I'm guessing follows the same principal so I'm guessing that's correct and I will just have to accept the fact my bonus has nearly halved

This is odd because it looks like you've been given tax and NI relief on your student loan - didn't think this was possible - is this a normal student loan? Or something funded by the employer?

joshreade

Normal student loan, plan 2

SandC

I usually work my bonus tax and NI out to be roughly 30% of the amount payable, that's usually about right. Seems to fit with your figures too (I don't have a student loan to take account of).

You have to bear in mind that a good proportion of your salary isn't taxable, but any extra in the form of bonuses will have the full tax deducted.

zagfles

joshreade wrote: »

Normal student loan, plan 2

This is getting confusing. Is the £96.15 on your normal payslip or the one with the bonus? Your OP implies it's your normal one then later you imply it's the one with the bonus.

Are you sure the £96.15 isn't a pension payment of some sort?

Can you give the numbers from last month's and this month's payslip, gross, tax, NI, pension, and student loan repayments.