Does this payslip look ok?

Da_Crojanz

I’ve tried online tax calculators and pretty much everything I try says I should get £70 - £100 more in pocket a month.m than what I do.

Tax code S1116L
salary 3996.40
tax 725.72
NI 353.81
Student loan 169.00
Pension (auto enrolment at 5%) 159.86

Take home 2588.01

Salary calculators seem to get my NI exact to the penny, slightly overestimate my pension contributions but say I’m overpaying tax by about £100.

The tax code would normally be s1275L but I get private healthcare as a taxable benefit, taking it down to s1116L.

Dazed_and_C0nfused

Impossible to say without knowing what method is used to contribute to the pension 

Net pay

Relief at source
Salary sacrifice 

Da_Crojanz

Pension isn’t the problem it’s why I’m paying £100 a month extra tax that is.

Dazed_and_C0nfused

Da_Crojanz said:

Pension isn’t the problem it’s why I’m paying £100 a month extra tax that is.

How can you calculate the tax without knowing which method is being used for the pension 🤔

Jeremy535897

Assuming the pension is just treated as a relief at source contribution by OP, you would expect the tax to be less, because applying a code of 1116 to a gross of £3,996.40 on a month 1 basis in England would give tax payable of about £613. Unfortunately, the S at the front means the monthly tax is £725, mostly because in Scotland the 42% (not 40%) band starts at £43,663 rather than £50,270, and OP's income is £49,366 including the benefit.

Da_Crojanz

I ticked the “resident in Scotland” box on the tax calculator. My wife lives in Scotland too and it gets her salary correct down to the penny!

I noticed that if I don’t put in a pension it gets the tax very close to what I’m paying. But as soon as I add a pension with any of the options it offers the tax goes down.

Dazed_and_C0nfused

Da_Crojanz said:

I ticked the “resident in Scotland” box on the tax calculator. My wife lives in Scotland too and it gets her salary correct down to the penny!

I noticed that if I don’t put in a pension it gets the tax very close to what I’m paying. But as soon as I add a pension with any of the options it offers the tax goes down.

Relief at source pension contributions (where basic rate tax relief is added to your contribution) don't reduce your income for tax purposes.

Jeremy535897

Yes, I forgot to knock off the pension when I worked it out, but as Dazed says, what sort of pension contribution is it? If it is relief at source, it would be grossed up to £200, which would give tax relief of £42 a month against the higher rate, assuming that's how it works in Scotland. It's certainly worth enquiring with your employer, for peace of mind at least.

Da_Crojanz

I’ll check with employer but the HR department is notoriously difficult to deal with and in general just tell employees to take it up with HMRC. I’ll try to find out what type it is. I am meant to contribute 5% which should be a fair bit more than the £159 they take as highlighted, but my tax still comes out at the best part of £100 more regardless.

Da_Crojanz

I suppose the question is, are there any types of pension that don’t offer tax relief so I know what to ask?

By removing my pension on the calculator my take home pay comes out at exactly £159 more than what I get, the exact amount of my pension. All very confusing.

Another question is, who do I speak to if there is a problem, which I think there must be as I’m searching now and can’t find any type of workplace pension that doesn’t offer tax relief? HR will just wave it away as they will want to cover it up and given the head of HR is very powerful in the company there is no realistic chance of pursuing it. Can HMRC do anything?

zagfles

The pension is clearly a RAS (relief at source) pension where the tax relief is claimed by the pension scheme, it's obvious just from the pension line in the payslip as it says AE 5% but only 4% is being deducted, so the other 1% comes from the tax relief. And that explains why it works if you ignore the pension, RAS contributions are deducted from after tax pay. So if you remove the pension from the calculator, it'll tell you what the take home is before the pension is taken off.

Check your pension statements, you should see tax relief being claimed. But you should be able to claim higher  rate tax relief from HMRC as you're into higher rate tax. You need to ask HMRC to change your tax code to include higher rate relief.