Help - Moved Jobs - Much higher payment

Chrissoa1994

Hi guys, I need some advice.

I worked for a company okay, I left them mid-month and after adding owed holidays, worked 15 days for them this month.

In my new company, I have worked 8 days for them.

For ease let’s label them A and B respectively.

Now, company A is paying me £1692 before tax, and 1404 after tax/NI

Company B is paying me about £705 before tax, and approx £700 after tax/NI.

In total I’m walking away with £2.1K after deductions.

Now the query, in general I earn roughly £1570 AFTER deductions.

Evidently, I’m walking away with near £550 extra in my back pocket.

So, in November, I will walk away with my standard £1570-ish salary.

With the above being mentioned,can I expect a huge emergency tax on the pay I receive in November or not?

I want to know how much of this 2.1K I need to put aside to cover any potential backlashes

Dazed_and_confused

Being paid twice in one (tax) month is a common reason for owing tax, crops up here and the Employments board fairly regularly.

Firstly dont forget you have presumably earned more than normal in this particular month? Is £2,400 or so your normal monthly salary?

National Insurance is generally calculated per payment so you may well have benefited by having two salary payments from (presumably) unconnected employers

You probably owe £141 in tax (assuming you will be a basic rate payer this tax year). You presumably got the benefit of your normal tax code against the first payment so should really have paid 20% tax on the wages from the second job which were paid in the same tax month.

Chrissoa1994

I thought as much in honesty (20% of the 700)

My “normal”salary is only 1600, rounded up.

My intentions are live off 1.1K as I had initially budgeted for this month anyway, and save the £1K to cover and backlashes.

If nothing comes of it,even better!

Dazed_and_confused

You will have to pay the tax.

Depending on when it is sorted you will end up with one of four methods,

1. All taken in one pay day, say end of November or December
2. Spready equally across pay days in the remainder of this tax year
3. Spread equally across pay days in the whole of the 2019:20 tax year
4. Spread equally across pay days in the whole of the 2020:21 tax year

Chrissoa1994

But to confirm the tax owed will be £140-ish, which is 20% of the £700 currently untaxed yep?

It won’t be emergency taxed it seems which was my concern

Dazed_and_confused

The whole reason you owe the tax is that your new employer used the emergency tax code. This allows you to be paid approx £988 before any tax starts to be deducted.

If you had handed in your P45 and your new employer had used it then you would have had the £141 deducted from the £705 (because your monthly tax free allowance given via your tax code had already been used in that tax month by employer A).

Dazed_and_confused

From the information you've given then yes it should be 20% of the £705.

If you are Scottish resident for tax purposes or your taxable income increases in the current tax year so you become a higher rate payer then this could change.