New company car + payrise = into 40%

T4i
T4i Posts: 1,845
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Hi all,

I am really struggling to work out my current PAYE situation due to a couple changes recently. I was given the chance to jump into a company car after my private car developed some major faults. I am a field service engineer so do lots of miles per year.

I went for a Diesel company car as some sites I visit are restricted to diesel engines only - hybrids and electric cars are not permitted unfortunately. 

The car I have jumped into is a Skoda Octavia Estate 2.0 TDI SE L 150PS DSG SCR, Automatic with 117g/km CO2 with a list price of £33,280. This was registered April 2023.

I have also just been given a payrise, taking me to 57,048 PA. I also get a discretionary bonus of around 4k PA which has always been awarded to me since I started 7 years ago.

I also get private health care and a company contribution pension.

I would like to get back down into the 20% TAX bracket by pumping more into my pension, however, I am really struggling to work out what % I should be putting in.

Can anyone help? Is there a spreadsheet or simple calculation that someone can explain to a non-tax-number person like me please?

My tax code changed recently to K1500 w1m1 which I presume is to do with the company car.

Comments

  • Dazed_and_C0nfused
    Dazed_and_C0nfused Posts: 12,772
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    T4i said:
    Hi all,

    I am really struggling to work out my current PAYE situation due to a couple changes recently. I was given the chance to jump into a company car after my private car developed some major faults. I am a field service engineer so do lots of miles per year.

    I went for a Diesel company car as some sites I visit are restricted to diesel engines only - hybrids and electric cars are not permitted unfortunately. 

    The car I have jumped into is a Skoda Octavia Estate 2.0 TDI SE L 150PS DSG SCR, Automatic with 117g/km CO2 with a list price of £33,280. This was registered April 2023.

    I have also just been given a payrise, taking me to 57,048 PA. I also get a discretionary bonus of around 4k PA which has always been awarded to me since I started 7 years ago.

    I also get private health care and a company contribution pension.

    I would like to get back down into the 20% TAX bracket by pumping more into my pension, however, I am really struggling to work out what % I should be putting in.

    Can anyone help? Is there a spreadsheet or simple calculation that someone can explain to a non-tax-number person like me please?

    My tax code changed recently to K1500 w1m1 which I presume is to do with the company car.
    The first thing you need to do is add up all your taxable income elements, taxable pay, company benefits and non ISA interest would be the starting point.

    Do you contribute to a pension?  If so do you know which method is used to contribute? 

    Net pay is where the contribution is taken before tax is calculated.  Relief at source is where the pension company adds 25% to whatever you contribute.
  • beatthebookienet
    beatthebookienet Posts: 39
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    edited 18 January at 9:52PM
    Take your gross income minus the threshold where 40% begins (I think £50k?) and divide it by 12 months and then put that amount into an AVC each month

    I.e £60k - £50k = £10k
    £10k ÷ 12 = £833.33 per month contributed into your pension/AVC
  • sheramber
    sheramber Posts: 18,636
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    Take your gross income minus the threshold where 40% begins (I think £50k?) and divide it by 12 months and then put that amount into an AVC each month

    I.e £60k - £50k = £10k
    £10k ÷ 12 = £833.33 per month contributed into your pension/AVC
    I think the OP's difficulty is how to work out his gross income. The value of comany benfits need to be added to earnings and any other non ISA income he receives
  • Albermarle
    Albermarle Posts: 21,146
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    The car I have jumped into is a Skoda Octavia Estate 2.0 TDI SE L 150PS DSG SCR, Automatic with 117g/km CO2 with a list price of £33,280. This was registered April 2023.

    Slightly off topic but this shows how new car prices seem to have shot up. I bet this was only £25K at most pre covid.

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