Tax situation on first job since long term unemployment

NurseMoneySaver1122

Hi

I’m going to be starting a job next month following long term unemployment. I have not been recieving benefits but living from both savings and my partners wage.

The job is well under the taxable earnings threshold. However, I’m assuming that i will pay emergency tax until my new employer works out my corrwct tax code (feom what ive read online).

Just wondering if there is anything I can do to minimalise the time it takes to get me onto the correct tax code?

Any advice/info would be greatly appreciated

Dazed_and_confused

You misunderstand what emergency tax means.

The whole point is you can earn the same as most people without paying any tax. The difference is each week is looked at separately so if you have unused tax allowances these are ignored.

For example

standard tax code and earnings of £988/month = no tax deducted

Emergency tax code and earnings of £988/month = no tax deducted

But you don't have to worry about that.

Ask your employer for a new starter checklist. Fill that out accurately and you will be put on the standard tax code on a cumulative basis which means you would have to earn nearly £9k by Christmas to actually pay any tax.

NurseMoneySaver1122

Apologies, I was using that term incorrectly.

What I was actually trying to get at is that I’m aware of people who have returned to work after a break, or young people who are starting their first job, whom have ended up not being placed on the correct tax code.

I had read earlier about filling in the new starter checklist from the employer, but then wondered how people still get placed on the wrong tax code if the form is filled out correctly?

So I assume then if I complete that form correctly, and get it filled in ASAP, I should a) be place on the correct tax code? And if not, it shouldn’t take months to rectify??

Dazed_and_confused

Going off posts on here and Cutting Tax board problems arise when people don't fill in the new starter checklist or they do but the employer ignores it.

Just make sure you complete one and give it to the correct person at your new employer.

That form is all that is required to get the correct tax code. Your new employer won't even have to contact HMRC if you fill it in correctly.

A) Yes
No

Dazed_and_confused

What's a cold tax code

NurseMoneySaver1122

Dazed_and_confused wrote: »

What's a cold tax code

🤦!♀️ Sorry, clearly too tired to proof read. Corrected now lol

chrisbur

NurseMoneySaver1122 wrote: »

I had read earlier about filling in the new starter checklist from the employer, but then wondered how people still get placed on the wrong tax code if the form is filled out correctly?

?

The new starter checklist has a limited number of tax codes that the new employer can use. These codes will cover most people but not all people so HMRC are advised of all new starters and if a different code is to be applied they send that to the employer. Also the new starter checklist can only cover details of pay and tax in previous employments if as in this case there is none, for most there are previous figures which HMRC have to send to the new employer.
So for quite a few people the tax code has to be altered causing a tax adjustment and also applying the pay and tax figures can result in a tax adjustment being needed.

NurseMoneySaver1122

chrisbur wrote: »

for most there are previous figures which HMRC have to send to the new employer.
So for quite a few people the tax code has to be altered causing a tax adjustment and also applying the pay and tax figures can result in a tax adjustment being needed.

So as I have no previous figures for HMRC to send to my new employer (not recent tax years anyway), there shouldn't be any tax adjustments to make and so I should be place day on the correct code the name right?

Although, it still often seems to be those who have been out of employement a while that have this issue, so that doesn't make sense. I'm obviously wrong somewhere or just not understanding.

I'll just have to fill out the form, hand it to my boss and hope I get placed on the right tax code from the start 🙏

Savvy_Sue

it is worth pointing out that some employers don't know how to run payroll properly, or they fail to pass the information on to their payroll providers in a timely manner. You'd hope any payroll providers WOULD know how to run payroll properly, but it can be patchy.

That's at least a partial explanation for why it sometimes goes wrong.

Check with the new employer when your first salary is due to be paid, and when the cutoff for adding you to payroll is. If you start early in the month and payment is made at the end, you should be OK, but the cutoff can be quite early: I HAVE to get information to our provider by the middle of the month, but that means I have to extract information from managers earlier than that.

chrisbur

NurseMoneySaver1122 wrote: »

So as I have no previous figures for HMRC to send to my new employer (not recent tax years anyway), there shouldn't be any tax adjustments to make and so I should be place day on the correct code the name right?

Although, it still often seems to be those who have been out of employement a while that have this issue, so that doesn't make sense. I'm obviously wrong somewhere or just not understanding.

I'll just have to fill out the form, hand it to my boss and hope I get placed on the right tax code from the start ��

As long as you select A
This is my first job since last 6 April and I have not been receiving taxable Jobseeker’s
Allowance, Employment and Support Allowance, taxable Incapacity Benefit,
State or Occupational Pension

and your employer uses the correct code for this selection you will be on 1185L cumulative.
From the details you have given that will be the correct code.
You said earlier that "The job is well under the taxable earnings threshold" so even if you accidentally selected B you still would not pay any tax.