Bonus - Confused Please Help

Jordy456

Hi All, I wonder if you could help me I am trying to sort my finances for the next 6 months and I am so confused about my bonus. Details below; 
Tax Code - 1288L
Wage - £45000
Bonus (One Off end of Feb) - £6780
TD NI 'Ees 3,443.00
 TD Gross Pay 36,661.67
TD Tax'ble Pay 36,661.67
TD Tax 5,184.00

When looking at Salary Calculator and adding my bonus on it shows a figure left after tax for the month off £7800 roughly... 
However, it also says; 

You might find that about an extra £986.37 of income tax than indicated is actually deducted from your bonus payslip. This is because your earnings in this pay period put you over the income tax threshold for the month, but not for the year. Normally, this "extra tax" is refunded in subsequent payslips.

Could anyone tell me what this means and am I to expect a refund of £986 at some point? If I am to expect a refund any ideas how it gets paid?

Thanks

chrisbur

I cannot see that you have reached the 40% tax band.  Can you advise what the tax deducted figure for the month was and also the month number or date of payment.

Jordy456

Hey Chris, 
The bonus payment will be made end of Feb so I think Month 11? 
My figures up to the end of Jan are;

TD NI 'Ees 3,443.00
 TD Gross Pay 36,661.67
TD Tax'ble Pay 36,661.67
TD Tax 5,184.00

[Deleted User]

Jordy456 said:

Hey Chris, 
The bonus payment will be made end of Feb so I think Month 11? 
My figures up to the end of Jan are;

TD NI 'Ees 3,443.00
 TD Gross Pay 36,661.67
TD Tax'ble Pay 36,661.67
TD Tax 5,184.00

It would be close if the code was on a M1 basis! As you say we need the gross pay for February before the bonus

Jordy456

purdyoaten2 said:

Jordy456 said:

Hey Chris, 
The bonus payment will be made end of Feb so I think Month 11? 
My figures up to the end of Jan are;

TD NI 'Ees 3,443.00
 TD Gross Pay 36,661.67
TD Tax'ble Pay 36,661.67
TD Tax 5,184.00

It would be close if the code was on a M1 basis! As you say we need the gross pay for February before the bonus

£ 3,766.67 is the gross without the bonus. 
£ 10,546.67 is the gross with the bonus

chrisbur

So earnings for month 11 would be
If we take 36661.67 add one month salary 3750.00 and the bonus 6780.00  we get £47191
Is that correct?
Assuming it is then £47191.00 you will just creep into the 40% band by about £800 so will pay that at 40% instead of 20% so 
about £163 extra.
Assuming you then get your normal salary of 3750 that will take you to £50941 which is £351 in the 40% band so about £450 will change from 40% to 20% and reduce the tax you pay that month by about £90

All figures rough calculations so may vary a little bit.

Jordy456

Ok so from the £985 it quotes il be refunded il actually only get about £90?:

chrisbur

Jordy456 said:

Ok so from the £985 it quotes il be refunded il actually only get about £90?:

I have no idea where the £985 comes from.  What figure did you put into the calculator for earnings and what tax code

[Deleted User]

Jordy456 said:

Ok so from the £985 it quotes il be refunded il actually only get about £90?:

chrisbur states that you will pay £163 extra in February and get £90 or so back in March.

chrisbur

I wonder if the calculator used was this one
https://www.thesalarycalculator.co.uk/salary.php
In this one you are asked what your bonus figure is but not when it is paid.
Problem is to work out the correct figures you have to know when the bonus is paid.
The earlier in the tax year that it is paid the higher the extra tax and thus the higher the tax reduction as the year progresses.

chrisbur

Jordy456 said:

purdyoaten2 said:

Jordy456 said:

Hey Chris, 
The bonus payment will be made end of Feb so I think Month 11? 
My figures up to the end of Jan are;

TD NI 'Ees 3,443.00
 TD Gross Pay 36,661.67
TD Tax'ble Pay 36,661.67
TD Tax 5,184.00

It would be close if the code was on a M1 basis! As you say we need the gross pay for February before the bonus

£ 3,766.67 is the gross without the bonus. 
£ 10,546.67 is the gross with the bonus

These figures came through while I was doing the sums and they vary slightly from the figures that I used based on 45000 a year so have run these through the HMRC calculator.
Month 11 gross 10546.67  tax due is 2061.53  . NI due 534.19
Month 12 gross 3766.67  tax due is 448.47        NI due 356.36

Total tax for the year on £50975.01 is £7694.00
The tax calculator gives tax as £7698 (almost certainly due to using the wrong tax allowance figure) it is the split between tax on normal earnings and bonus earnings that is wrong. The "£985 to be repaid" never existed, nothing like this amount was over-deducted so it was never going to be repaid.