PAYE Tax Calculator

Dazed_and_confused

Actual figure for 1304M is £13049.16

This is no doubt true for the purposes of calculating your monthly PAYE tax deductions however an M tax code signifies you are receiving Marriage Allowance and if you ever need a tax calculation after the tax year has finished (or complete Self Assessment returns) you should be aware that Marriage Allowance does not actually entitle you to any extra allowances.

You have to work out your tax ignoring the Marriage Allowance (and using Personal Allowance of £11850, not £11859) and once you have worked out the tax due for the year having received Marriage Allowance means you can then deduct a fixed amount of your tax bill (£238 in the current tax year).

Basically PAYE tax codes use one system but if you ever need a calculation after the tax year ends it is a completely different way of calculating things.

chrisbur

Dazed_and_confused wrote: »

Basically PAYE tax codes use one system but if you ever need a calculation after the tax year ends it is a completely different way of calculating things.

Not sure I would go so far as to call it "a completely different way" but certainly a bit more accurate than PAYE calculation.
Talking of HMRC re-calculating tax due I see that this year April 5 falls on a Friday so probably quite a few week 53s happening. I know that a few years back HMRC were re-calculating for week 56s and adjusting the next year's code; anyone know if they are doing this for week 53s or does it come under the figure that they do not bother with. When I was last doing PAYE just about every-one got to keep their week 53 tax allowance.

Dazed_and_confused

I was meaning more about the Marriage Allowance really. It is an allowance in a tax code so people get the benefit during the year but strictly there is no extra allowance, it is a tax reducer, very much like Married Couple's Allowance is.

Good point about week 53. For people on the standard 1185L code it's going to be £45+ I think so I can't imagine that being ignored

BarneyJ87

chrisbur wrote: »

Actual figure for 1304M is £13049.16

Managed to get my head around the tax tables, and can see where this figure came from, much obliged again

judemccullers

Hope this is a suitable place for a general PAYE-discrepancy kind of question.

I always thought I had a pretty good grasp on PAYE, and have myself set up spreadsheets and the like to work out what I should expect my payslip to look like. However it would seem not. My latest payslip has about £100 more tax than I was expecting - but, the figures match up with what the HMRC website "payecalculator.hmrc.gov.uk/PAYE1.aspx" says it should be. I always thought the whole point of PAYE was that if you earn the same every month, you pay the same tax every month. But, the calculator at that link says I will pay a fraction of the tax next month than I did this month.

Details:
Tax code 1185L Month 11 Cumulative

Gross (taxable) pay: £2000
Previous taxable pay to date: £13000
Previous tax to date: £500

My payslip, and the calculator, say tax due = £390.

But putting the figures in for month 12 gives

Gross (taxable) pay: £2000
Previous taxable pay to date: £15000
Previous tax to date: £890

Tax due: £138.

Can someone explain why this is/what's going on here?

Comms69

judemccullers wrote: »

Hope this is a suitable place for a general PAYE-discrepancy kind of question.

I always thought I had a pretty good grasp on PAYE, and have myself set up spreadsheets and the like to work out what I should expect my payslip to look like. However it would seem not. My latest payslip has about £100 more tax than I was expecting - but, the figures match up with what the HMRC website "payecalculator.hmrc.gov.uk/PAYE1.aspx" says it should be. I always thought the whole point of PAYE was that if you earn the same every month, you pay the same tax every month. But, the calculator at that link says I will pay a fraction of the tax next month than I did this month.

Details:
Tax code 1185L Month 11 Cumulative

Gross (taxable) pay: £2000
Previous taxable pay to date: £13000
Previous tax to date: £500

My payslip, and the calculator, say tax due = £390.

But putting the figures in for month 12 gives

Gross (taxable) pay: £2000
Previous taxable pay to date: £15000
Previous tax to date: £890

Tax due: £138.

Can someone explain why this is/what's going on here?

Obviously though you haven't been paid the same this month as last month?


You are calculating your yearly liability, but this month the amount is higher than expected.

judemccullers

This month is month 11.

I would expect to pay the same tax in month *12* as I have done this month, month 11, *if* I earn the same amount, in month *12*, as I have done this month, month 11.

But the calculator says this is not the case


Are you saying they base it on your average for the whole year? As in they expect me to earn £15000 ÷ 11 next month? I don't see how this makes the figures make any more sense?


Basically, what is the calculation that takes place, the answer to which is "£390"? Nothing I previously understood about PAYE allows me to arrive at this figure.

chrisbur

judemccullers wrote: »

Hope this is a suitable place for a general PAYE-discrepancy kind of question.

I always thought I had a pretty good grasp on PAYE, and have myself set up spreadsheets and the like to work out what I should expect my payslip to look like. However it would seem not. My latest payslip has about £100 more tax than I was expecting - but, the figures match up with what the HMRC website "payecalculator.hmrc.gov.uk/PAYE1.aspx" says it should be. I always thought the whole point of PAYE was that if you earn the same every month, you pay the same tax every month. But, the calculator at that link says I will pay a fraction of the tax next month than I did this month.

Details:
Tax code 1185L Month 11 Cumulative

Gross (taxable) pay: £2000
Previous taxable pay to date: £13000
Previous tax to date: £500

My payslip, and the calculator, say tax due = £390.

But putting the figures in for month 12 gives

Gross (taxable) pay: £2000
Previous taxable pay to date: £15000
Previous tax to date: £890

Tax due: £138.

Can someone explain why this is/what's going on here?

Not sure what you did here for month 12 when I ran it I got about £200.

The problem with your figures for month 11 is that for a taxable previous gross of £13000.00 the figure for previous tax should be about £625.00
So the question is what happened at month 10
Can you give from month 10 payslip the taxable gross tax paid tax code/basis taxable gross to date and tax paid to date.

As you say same pay = almost the same tax
Except for some exceptions which will hopefully show up when we see details of month 10

chrisbur

judemccullers wrote: »

This month is month 11.

I would expect to pay the same tax in month *12* as I have done this month, month 11, *if* I earn the same amount, in month *12*, as I have done this month, month 11.

But the calculator says this is not the case


Are you saying they base it on your average for the whole year? As in they expect me to earn £15000 ÷ 11 next month? I don't see how this makes the figures make any more sense?


Basically, what is the calculation that takes place, the answer to which is "£390"? Nothing I previously understood about PAYE allows me to arrive at this figure.

It is month 10 we need to look at that is what has caused this. Month 11 on the calculator is correcting for under-taxing that occured in month 10

judemccullers

OK, so I feel I have updated my understanding of what's meant to be happening -- PAYE wants me to be paying 20% x ((£2000 x 12) - £11850) ÷ 12 tax each month, but this month requires a "correction" to set me on track for that?

I got two payslips from two employers in month 10 - the one at the new job on a month 1 basis; the one from the old job only having holiday pay so resulting in a tax refund, which is why the tax to date is less than you'd expect.

Payslip for new job:

Gross taxable pay: £1750
Previous taxable pay to date: £0
Previous tax to date: £0

Tax paid: £152.20

Other job I don't have the payslip for, but it was something like taxable gross=£150, tax paid £-100, and the cumulative figures working out to give the figures in my original post, once the month 10 pay from the new job has been added on. I realise it's frustrating not to have correct figures to work from, but hopefully this at least "illustrates" the situation sufficiently..

Trying to post a screenshot of what I got out of the calculator but I'm not allowed