Personal Tax code question

MoneyPleaseHelp

Afternoon all

I am after some help from the Guru's

I have been unsure of my tax code because on my company pension and asked my HR department who pointed me to HMRC as they were unsure

This is my monthly wages
Gross 4178
PAYE 701
NI 385.62
Pension contribution 133.70

Take home Pay 2957.85

Tax code 1185L

The pension is being worked out like this

Your pension is deducted after tax, so you pay 4% less 20% tax relief = 3.2% pension taken from your net pay.

The 20% saving is added back in by the pension scheme topping you back up to 4% employee contributions

I spoken to HMRC this morning and got a little confused they have said my tax code was wrong and should be 1265L fro current year and 1330L for 19-20. does this sound right ?


2nd question
In April i will be paying 5% into my pension and should hopefully get a payrise. do i then need to go back to HMRC again to get the code changed again

Thanks for any help and advice and sorry if this has been covered before i just getting lost so hope someone can make it simple for me :-)

xylophone

See https://www.litrg.org.uk/latest-news/news/181214-do-you-understand-how-tax-relief-your-pension-contributions-works
under "relief at source".

https://thepeoplespension.co.uk/help/knowledgebase/whats-relief-at-source/

Dazed_and_confused

I spoken to HMRC this morning and got a little confused they have said my tax code was wrong and should be 1265L fro current year and 1330L for 19-20. does this sound right ?

Nobody can possibly answer that unless you tell us how the tax codes have been calculated. It might be 1265L made up of Personal Allowance 11,850 plus pension relief adjustment of 800.

Or Personal Allowance 11,850 plus pension relief adjustment 500 plus job expenses 300.

Or a billion other possibilities.

At face value you are due some higher rate pension relief for 2018:19

But are due virtually none in 2019:20 (because based on your post you will only be paying higher rate tax on £136).

So your tax codes for both years are probably wrong and you may owe HMRC some tax back. But without full details it really is impossible to say.

xylophone

But are due virtually none in 2019:20 (because based on your post you will only be paying higher rate tax on £136).

The OP mentions "getting a pay rise" - perhaps this will be substantial?

Dazed_and_confused

Quite possibly but impossible to know if the tax code is correct or not without knowing the actual income (estimate) for 2019:20.