How does tax work?

ndt32

Help me understand something. I just recently got a new job, and I received my first weekly payslip. Despite earning over the weekly allowance, I have not been taxed (NI has been deducted).

Is this because even though I've earned more than 12500/52 this week, I won't accumulate more than 12500 before next april (I started in september)? Or does tax work purely on a payday basis?
Thanks, apologies for my lack of tax knowledge.

ndt32

I should add this is my first job this tax year.

Brynsam

If you've not had a job in the current tax year, then you haven't yet used up any of your personal allowance. This is approximately £240 a week and builds up week on week during the tax year (6 April to 5 April) - e.g. if you started your first job 10 weeks into a tax year, you could earn 10 x £240 (£2,400) in your first week before paying any tax. We are now 22 weeks into the tax year, so you'd need to have earned more than £5,280 (22 x £240) this week before you had to pay tax...and so on until 5 April 2021, with the tax free bit increasing at £240 a week.

If you don't earn over £12,500 in the tax year 2020/21, and have no other income from other sources which is potentially taxable, you won't pay any tax between now and 5 April 2021.

getmore4less

Some benefits are taxable so you may need to take those into account if you got any.
one thing to watch is there will be a drop of net income next year so might be a good idea to live to that pay for now and save the rest or put it to one off and not get used to having extra.

if you stick your annual in here you can get an idea of what the ongoing pay will be from April
https://listentotaxman.com/

eg Say you were on £20k take home will be around £125pm less once into a full year