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Car allowance and tax codes
NottsLad76
Posts: 2 Newbie
in Motoring
Hi All,
On a 50k a year salary and a 450/month car allowance, but I dont understand the tax I am paying: to explain.
SalaryCalculator maths:
50k with tax code 1250L + 450 tax deductable benefits = £2947 net
56k (HMRC just looking at car allowance as salary) with tax code 503L with no benefits listed = 3168 net (my current wage slip)
56K with 1250L + no benefits listed = 3400
I get the 40% car allowance maths, but why are they not calling my situ 56k (car allowance shows on the left hand side of payslip) with the 1250L code, please?
Instead they are adjusting my tax code to the lower number to accommodate and I am worse off?
If I took a leased car with the 450 per month, would I then pay for a leased car off my net pay (so an average car now cost me 650 a month???) Or would they have the 56k with a 1250L tax code and then tax me (if that makes sense)
A few hundred a month is the difference between taking a car or not for me.
I dont mind paying the tax, but it's more that I am worse off on a tax code that I am on without taking a car it seems IF they dont put me on 56k and a 1250 tax code.
Currently the car allowance seems 'wasted' in tax, but I would be almost better being on 50k with no car allowance and leasing a car for same value per month (and a 1250L code) - this doesnt make sense to me.
Cheers!
On a 50k a year salary and a 450/month car allowance, but I dont understand the tax I am paying: to explain.
SalaryCalculator maths:
50k with tax code 1250L + 450 tax deductable benefits = £2947 net
56k (HMRC just looking at car allowance as salary) with tax code 503L with no benefits listed = 3168 net (my current wage slip)
56K with 1250L + no benefits listed = 3400
I get the 40% car allowance maths, but why are they not calling my situ 56k (car allowance shows on the left hand side of payslip) with the 1250L code, please?
Instead they are adjusting my tax code to the lower number to accommodate and I am worse off?
If I took a leased car with the 450 per month, would I then pay for a leased car off my net pay (so an average car now cost me 650 a month???) Or would they have the 56k with a 1250L tax code and then tax me (if that makes sense)
A few hundred a month is the difference between taking a car or not for me.
I dont mind paying the tax, but it's more that I am worse off on a tax code that I am on without taking a car it seems IF they dont put me on 56k and a 1250 tax code.
Currently the car allowance seems 'wasted' in tax, but I would be almost better being on 50k with no car allowance and leasing a car for same value per month (and a 1250L code) - this doesnt make sense to me.
Cheers!
0
Comments
-
trying to answer my own question, but am I am actually describing (or requesting) a situ where my leased car would be 'salary sacrifice?' hmmmm0
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