New style ESA tax

EBay42

I wondered how new style ESA is taxed? I am still receiving half contractual sick pay so am applying for new style ESA in addition to this as my SSP is ending. Is ESA taxed through my payroll, or do I have to pay it back to DWP? Very confused. Want to avoid a tax bill when I no longer need ESA as I only envisage needing it for around six months. 

sammyjammy

Its a taxable benefit but no tax is not deducted at source, if with your salary and ESA you owe additional tax at the ned of the year you receive a notice to pay from HMRC, you should be able to work this out in advance if this will apply and roughly how much you can expect to be asked for.

EBay42

Thank you for this. Will a tax bill need to

EBay42

Thank you for this. Will a tax bill need to be paid in full by a deadline or can you spread the bill out across a number of months by adding it onto usual tax paid through employment?

Robbie64

EBay42 said:

Thank you for this. Will a tax bill need to be paid in full by a deadline or can you spread the bill out across a number of months by adding it onto usual tax paid through employment?

Any tax owing is usually recovered by adjusting your tax code. This normally means you pay back what you owe over a number of months.