We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
📨 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!
Tax question
Options
Comments
-
Airblower said:Month 2 is what concerns me. Am I right in thinking they will take 40% even though it should be 20% as my monthly pay will be back to normal?
I won't be paying all my bills that month if that's the case.
Have you tried the calculator yet to see how much the tax will drop in month 2?0 -
Airblower said:Month 2 is what concerns me. Am I right in thinking they will take 40% even though it should be 20% as my monthly pay will be back to normal?
I won't be paying all my bills that month if that's the case.
Have you already got plans for that 11k then? You could hold a bit back ready for Month 2's bills. I completely see your position though.0 -
Month 1 you would pay £5116.95 in tax.
Month 2 you would pay £367.58
The above assumes the emergency tax code (1257L) is in use.0 -
pavvers said:chrisbur said:This would result in paying more national insurance.
The OP is on £47700 so £3975 a month.
So if £11000 added to month 1 then £214 of bonus paid at 8% rest at 2%
If however it is split over the year then each month £214 of it is charged at 8% and the rest at 2%
An extra 11 months paying 8% of £214 instead of 2%
Also you do not have the opportunity to save some of this bonus and get interest on it.
Also employer might go bust and you never get all the bonus.1 -
Airblower said:Month 2 is what concerns me. Am I right in thinking they will take 40% even though it should be 20% as my monthly pay will be back to normal?
I won't be paying all my bills that month if that's the case.
Each month your allowances will increase so you get more tax free allowance more 20% band allowance and more 40% and 45% band allowances.
Because of this as each month comes round some (possibly all) tax you paid at 45% is converted to tax at 40% and some tax you paid at 40% is converted to tax at 20%
The result of these taxes going down is that you will pay less tax than you would normally on a salary of £47700.
As your salary plus bonus probably puts you into the 40% tax band your tax figure will stabilize once all 45% tax has been converted, this will still be lower than "normal" tax on your salary due to the extra tax paid in month 11 -
Airblower said:Month 2 is what concerns me. Am I right in thinking they will take 40% even though it should be 20% as my monthly pay will be back to normal?
I won't be paying all my bills that month if that's the case.An example not taking into account pension deductions, student loan etc, just basic pay.On a monthly gross of £3975, £47700 pa, your take home would be £3155.64 after £582.20 tax.Getting an extra £11K in April would mean a take home of £9391.05 after £5116.95 tax.May take home would be £3373.26 after £367.58 tax.June onwards would be £3198.37 after £542.47 tax.So every month will be more than what you would have received on just the basic salary due to the excess tax in April being drip fed back.
0 -
Thanks all0
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 351.2K Banking & Borrowing
- 253.2K Reduce Debt & Boost Income
- 453.7K Spending & Discounts
- 244.2K Work, Benefits & Business
- 599.3K Mortgages, Homes & Bills
- 177K Life & Family
- 257.6K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.2K Discuss & Feedback
- 37.6K Read-Only Boards