Income tax on part time secondary job

Dazed_and_C0nfused

Phoenix72 said:

Superhoopza said:

If I understand correct, the pension contributions won't lower taxable pay unless the OP is on a salary sacrifice scheme. Otherwise it's a straight percentage of the £44k gross pay they have quoted.

No, if payments are made via net pay scheme then this also reduces taxable pay.

And even if it's relief at source it will ultimately have a similar impact, just involves having to deal with HMRC.

Tommy1975

Bookworm105 said:

Tommy1975 said:

Bookworm105 said:

Dazed_and_C0nfused said:

Bookworm105 said:

she is allowed to transfer 10% of her personal allowance to you.
nothing more, read this Marriage Allowance: How it works - GOV.UK (www.gov.uk)

There are many families with a LOT less than you have who also live ion London yet they cut their cloth accordingly and live on it. Minimum wage rate is for those for whom that is their entire income rate, so wailing that as a 40% taxpayer it's not enough is just pathetic.

But the op won't be eligible for Marriage Allowance if they are a higher rate payer.  Although they may well not be with the decent level of pension contributions they are making.

correct, I got distracted by all the woe is me wailing.

I can't seem to find the comment you made about me, but just know I'm not here looking for sympathy. There's lots of people earning less than me, of course there is, but that will be little comfort to my family when we lose our home next year if I don't do something about it. My point is a couple earning 49k each have a combined income of 98k before entering the high tax bracket. So wanted to know if a couple can share their tax bracket to level the playing field a bit, that's all. I'm not currently in it, but will be once I earn 6k from part work. That's on top of the 42 hours that I already work. I don't need you to feel sorry for me. As it stands I'm looking at options to keep a roof over our heads and working for about £10 per hour after paying 40% isn't going to get us out of trouble. Not sure how else to "cut the cloth", we already live a very simple life. So if you've got some helpful advice that'd be great. If not why say anything? You don't know me. You don't know how I live. You don't know the effects this has had on my relationship with my wife. You have no idea how much pressure we're under. I didn't vote for austerity, I'm just trying to raise a family through it the best I can. They already go without enough. Im doing whatever I can to make sure we don't lose our home as well. Thanks for your time

again you have written a sob story instead of focusing on your question. I could introduce you to many families for whom 44k combined income would be an impossible dream.

I pointed out that your wife could transfer 10% of her personal allowance to you, HOWEVER, that is only possible if you remain a basic rate taxpayer. As your plan is to increase your earnings into higher rate she will no longer be able to do that.

It is clear from subsequent comment you don't understand how you are taxed, so focus on answering the question regarding your pension. On your payslip is the "taxable pay" figure lower than the gross pay figure. If it is then the threshold at which you hit higher rate tax is further away than you think it is. 

I've tried to explain our situation in full to enable people in the know to give sound advice, nothing else. This means explaining income, contributions the situation we're in and how little extra I'll earn for the amount of hours I'll have to work to make a difference. How else do I get that necessary information across? I appreciate your advice, but as you're such a condescending....erm person I think I'll decline your advice and concentrate on the advice offered by the less judgemental contributors now. Thanks again 

Dazed_and_C0nfused

Tommy1975 said:

Phoenix72 said:

If your pension contributions are taken from your gross pay then your taxable pay must be much less than the £44k, what do your payslips show as taxable pay? This should give you more leeway before hitting the higher rate threshold.

Thanks, I didn't realise that. I'll have a look tomorrow 

This is a crucial aspect relating to your original query.

There are two likely outcomes, either you are contributing from gross pay so the £44k you referred to is likely to be irrelevant (assuming that is your salary pre pension contributions) and your taxable pay is more likely to be £38-40k meaning you have £10k basic rate band left.

Even if your pension is paid using the relief at source method where your taxable pay will remain £44k you will have an increased basic rate band.

It's quite possible you will end up just paying 20% on the new job and also be eligible for Marriage Allowance.

But as ever with income tax the devil is in the detail.

Tommy1975

Dazed_and_C0nfused said:

Tommy1975 said:

Phoenix72 said:

If your pension contributions are taken from your gross pay then your taxable pay must be much less than the £44k, what do your payslips show as taxable pay? This should give you more leeway before hitting the higher rate threshold.

Thanks, I didn't realise that. I'll have a look tomorrow 

This is a crucial aspect relating to your original query.

There are two likely outcomes, either you are contributing from gross pay the £44k you referred to is likely to be irrelevant (assuming that is your salary pre pension contributions) and your taxable pay is more likely to be £38-40k meaning you have £10k basic rate band left.

Even if your pension is paid using the relief at source method where your taxable pay will remain £44k you will have an increased basic rate band.

It's quite possible you will end up just paying 20% on the new job and also be eligible for Marriage Allowance.

But as ever with income tax the devil is in the detail.

I really appreciate the advice. I'm working tomorrow so can access my P60 and check my taxable income. It's not something I've looked at before because I never considered my pension could affect it. Thanks

Dazed_and_C0nfused

Tommy1975 said:

Dazed_and_C0nfused said:

Tommy1975 said:

Phoenix72 said:

If your pension contributions are taken from your gross pay then your taxable pay must be much less than the £44k, what do your payslips show as taxable pay? This should give you more leeway before hitting the higher rate threshold.

Thanks, I didn't realise that. I'll have a look tomorrow 

This is a crucial aspect relating to your original query.

There are two likely outcomes, either you are contributing from gross pay the £44k you referred to is likely to be irrelevant (assuming that is your salary pre pension contributions) and your taxable pay is more likely to be £38-40k meaning you have £10k basic rate band left.

Even if your pension is paid using the relief at source method where your taxable pay will remain £44k you will have an increased basic rate band.

It's quite possible you will end up just paying 20% on the new job and also be eligible for Marriage Allowance.

But as ever with income tax the devil is in the detail.

I really appreciate the advice. I'm working tomorrow so can access my P60 and check my taxable income. It's not something I've looked at before because I never considered my pension could affect it. Thanks

Based on your original post it's quite likely that your P60 will show something more like £38k as your taxable income.

Hi, I currently earn just under £44000 per year working around 42 hours per week. My wife earns just above minimum wage but it works around the kids. I already pay 13.5% of my wages to the pension scheme 

EnPointe

Phoenix72 said:

First suggestion - get some paragraphs as that is a wall of text that is difficult to read.

A few questions, why would you lose most of what you paid in if you opted out of pension scheme? (Not that it would be a good idea)

Are your pension contributions taken from gross or net pay? How much does your wife actually earn?

the OP is either Met or LFB with pension contribution of that extent and the  dis advantageous terms of taking it asa deferred member  / opting out 

Flugelhorn

Tommy1975 said:

Bookworm105 said:

Dazed_and_C0nfused said:

Bookworm105 said:

she is allowed to transfer 10% of her personal allowance to you.
nothing more, read this Marriage Allowance: How it works - GOV.UK (www.gov.uk)

There are many families with a LOT less than you have who also live ion London yet they cut their cloth accordingly and live on it. Minimum wage rate is for those for whom that is their entire income rate, so wailing that as a 40% taxpayer it's not enough is just pathetic.

But the op won't be eligible for Marriage Allowance if they are a higher rate payer.  Although they may well not be with the decent level of pension contributions they are making.

correct, I got distracted by all the woe is me wailing.

I can't seem to find the comment you made about me, but just know I'm not here looking for sympathy. There's lots of people earning less than me, of course there is, but that will be little comfort to my family when we lose our home next year if I don't do something about it. My point is a couple earning 49k each have a combined income of 98k before entering the high tax bracket. So wanted to know if a couple can share their tax bracket to level the playing field a bit, that's all. I'm not currently in it, but will be once I earn 6k from part work. 

Tax bands can be frustrating but that is the way they are - I was in a situation earning well into the 40% band and losing personal allowance. DH was not earning. No transferable marriage allowance.    Nothing you can do about the tax bands other than to realise that the "tax man doesn't take everything" - you still have extra even if you are paying more tax. 

Tommy1975

Flugelhorn said:

Tommy1975 said:

Bookworm105 said:

Dazed_and_C0nfused said:

Bookworm105 said:

she is allowed to transfer 10% of her personal allowance to you.
nothing more, read this Marriage Allowance: How it works - GOV.UK (www.gov.uk)

There are many families with a LOT less than you have who also live ion London yet they cut their cloth accordingly and live on it. Minimum wage rate is for those for whom that is their entire income rate, so wailing that as a 40% taxpayer it's not enough is just pathetic.

But the op won't be eligible for Marriage Allowance if they are a higher rate payer.  Although they may well not be with the decent level of pension contributions they are making.

correct, I got distracted by all the woe is me wailing.

I can't seem to find the comment you made about me, but just know I'm not here looking for sympathy. There's lots of people earning less than me, of course there is, but that will be little comfort to my family when we lose our home next year if I don't do something about it. My point is a couple earning 49k each have a combined income of 98k before entering the high tax bracket. So wanted to know if a couple can share their tax bracket to level the playing field a bit, that's all. I'm not currently in it, but will be once I earn 6k from part work. 

Tax bands can be frustrating but that is the way they are - I was in a situation earning well into the 40% band and losing personal allowance. DH was not earning. No transferable marriage allowance.    Nothing you can do about the tax bands other than to realise that the "tax man doesn't take everything" - you still have extra even if you are paying more tax. 

To be honest, if I was well into the tax band on my normal hours I'd be fine with that. It would mean I'm earning decent money for the hours I already work. Id be fine if I was paid well for the part time work as I'd still be taking home a decent amount of extra money after tax for each subsequent hour worked. The problem is being just on the cusp and then not being paid much for the extra work. It renders it pointless doing the extra work at all as it won't change our current situation other than I'll spend even less time at home and still be struggling. And then us AND the tax man get nothing.