Changing full time to part time employment: How PAYE tax is calculated

Samrazakir

it is February (last tax year), tax code 1250 L and paid monthly. The employer didn't mention any tax rebate.

unholyangel

Samrazakir said:

it is February (last tax year), tax code 1250 L and paid monthly. The employer didn't mention any tax rebate.

The figures aren't making sense. 

If the code was cumulative, you would have been due a refund of £2293.40 for february based on those pay & tax figures with a code of 1250L. Even on a non cumulative code, you'd be due to pay £0 as the monthly allowance for 1250L is 1042.43 and earnings of £880 would be below that. 

Do you have your p60 for the 19/20 year? Does your employer process the payroll themselves, they don't have a payroll department/company or an accountant who does it for them? 

Tbh it sounds like your employer doesn't know !!!!!! from elbow and has wrongly interpreted the regulatory limit as a deduction rather than just a statement of what the limit is for that pay. Which is why I'm asking so many questions, as it's concerning. The NI is explained now you've clarified it was a pay from the previous tax year where the NI limit was lower. Was it around £19.32? 

chrisbur

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

Yes no idea what I was doing there for the NI figure.

I have a suspicion that this relates to a previous post where the OP has been overpaid and the employer is now adjusting the figures.
https://forums.moneysavingexpert.com/discussion/6158928/massive-salary-overpayment-by-employer-how-to-get-out-of-it/p1

OP if this is the case I think it would be helpful if you gave full payslip details of overpayment and what the gross payments should have been.

unholyangel

chrisbur said:

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

Yes no idea what I was doing there for the NI figure.

I have a suspicion that this relates to a previous post where the OP has been overpaid and the employer is now adjusting the figures.
https://forums.moneysavingexpert.com/discussion/6158928/massive-salary-overpayment-by-employer-how-to-get-out-of-it/p1

OP if this is the case I think it would be helpful if you gave full payslip details of overpayment and what the gross payments should have been.

But the OP said the deduction is for tax. Surely if they were on the ball enough to know they were being overpaid, they'd also know it was for the overpayment of wages and not tax? 

Then again, OP also says some months of overpayment were for this tax year and some were for last (in that other thread). Which is at odds with them being paid £880 in february. So who knows! 

chrisbur

unholyangel said:

chrisbur said:

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

unholyangel said:

chrisbur said:

You had a tax rebate here.  The rebate is added to your gross pay.  So in this case net would be gross plus rebate minus NI if there was any, in this case earnings lower than threshold so no NI.  The figures for regulatory limits are just there if required in this case not required so ignore them.
NI calculator here if required....
http://nicecalculator.hmrc.gov.uk/Class1NICs1.aspx

Monthly thresh for this year is £792. So £10.56 NI due. 

Samrazakir said:

Thank you, my employer just calculated the net salary as follows:
 gross(£880) - tax (£440) - NI (£20)  =£420
I am baffled at their calculations as I get the above figure using PAYE tax calculator, it seems the regulatory amount (£440) should not be relevant here, not sure why employer put it in the tax, where I should have been getting tax rebate instead of further tax deduction? Please correct if I am wrong.

Why the heck is your employer deducting £440 in tax if it says you're due a tax refund? Both cannot be true. Even the NI looks wrong if your gross was only £880. 

What was the date of the pay, what is your tax code & how often are you paid? 

Yes no idea what I was doing there for the NI figure.

I have a suspicion that this relates to a previous post where the OP has been overpaid and the employer is now adjusting the figures.
https://forums.moneysavingexpert.com/discussion/6158928/massive-salary-overpayment-by-employer-how-to-get-out-of-it/p1

OP if this is the case I think it would be helpful if you gave full payslip details of overpayment and what the gross payments should have been.

But the OP said the deduction is for tax. Surely if they were on the ball enough to know they were being overpaid, they'd also know it was for the overpayment of wages and not tax? 

Then again, OP also says some months of overpayment were for this tax year and some were for last (in that other thread). Which is at odds with them being paid £880 in february. So who knows! 

Not really sure but reading both threads I get the impression that the OP has been overpaid and they are now trying to work out what the correct payments should have been after tax/NI.  Possibly to check figures given by the employer for corrected payslips. Has the employer done manual calculations for corrections and used that regulatory figure for tax in these calculations?