We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide
We're aware that some users are currently experiencing errors on the Forum. Our tech team is working to resolve the issue. Thanks for your patience.
Personal Allowance and Pension Tax Calculator
bms0921
Posts: 12 Forumite
in Cutting tax
Hi!
My salary is currently £100,000 and I have the potential to earn ~25% bonus annually, paid out in March. This is variable depending on performance / business results but is typically around £25,000.
I completed a self-assessment for 2021/2022 in December 2022 and had an overpayment of £2800 which I'm repaying over 12 months. I have adjusted my estimated income online so my personal allowance is also being deducted.
All of this means that my monthly income is ~£4,700 and has actually gone down about £300 since my pay increase.
It feels like I'm missing something about maximising my salary. I know tax is 60% + 2% NI between 100-125k and I should maximise pension contributions but I can't find a calculator to help me work out what this looks like and the impact it would have on my take home pay on a monthly basis. I saw someone on another thread had figured this out but I was wondering if anyone knows a calculator or a tool I could do to work through this? My nervousness at putting more in a pension is that my brain assumes I'll have less money to take home but I don't think my understanding is correct and I can't work out how to calculate it.
Can anyone point me in the right direction?
Big thanks
My salary is currently £100,000 and I have the potential to earn ~25% bonus annually, paid out in March. This is variable depending on performance / business results but is typically around £25,000.
I completed a self-assessment for 2021/2022 in December 2022 and had an overpayment of £2800 which I'm repaying over 12 months. I have adjusted my estimated income online so my personal allowance is also being deducted.
All of this means that my monthly income is ~£4,700 and has actually gone down about £300 since my pay increase.
It feels like I'm missing something about maximising my salary. I know tax is 60% + 2% NI between 100-125k and I should maximise pension contributions but I can't find a calculator to help me work out what this looks like and the impact it would have on my take home pay on a monthly basis. I saw someone on another thread had figured this out but I was wondering if anyone knows a calculator or a tool I could do to work through this? My nervousness at putting more in a pension is that my brain assumes I'll have less money to take home but I don't think my understanding is correct and I can't work out how to calculate it.
Can anyone point me in the right direction?
Big thanks
0
Comments
-
If you pay £20,000 of your bonus into your pension scheme, that grosses up to £25,000 and extends your basic rate band by £25,000.0
-
I understand the principle but was hoping there was a calculator / tool available that could show what this looks like on a monthly basis / impact on my take home pay?0
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 354.5K Banking & Borrowing
- 254.4K Reduce Debt & Boost Income
- 455.4K Spending & Discounts
- 247.4K Work, Benefits & Business
- 604.2K Mortgages, Homes & Bills
- 178.5K Life & Family
- 261.6K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 37.7K Read-Only Boards