Tax query

johnnyren

Hi 
      I have a tax issue which has cropped up and causing a bit of concern 

I receive 1400 pounds per month drawdow from my 25% tax free pension pot 

for 2 years I have had a small part time job paying 110 pounds a week ,  no tax was taken from me .

4 months ago the company changed hands and we went to fortnighly pay , my wage is now 220 pounds again no tax taken 

last month the company put us on monthly pay ,  there was a wage rise in it and I got about 500 pounds and was taxed 70 pounds and my tax code had changed 

have I crossed a tax threshold somewhere ?    And if so why hasn’t the company worked for took tax previously.     Even my ifa never told me I’d be liable for tax ,      Now I’m worried I’m going to get hit with a backdated bill 

any advice appreciated 

johnnyren

Hi
     I have a tax issue that has cropped up ,  I’d be grateful for some advice before tackling the tax office if needed ,  it’s a bit confusing so I’ve tried to put it as simply as I can.

I am taking 1400 pounds a month tax free from my pension drawdown .

about 2 yrs ago I took on a small part time cleaning job taking in approx 110 pounds a week which was tax free.

The company changed hands a few months ago and put us on fortnightly pay , I recorded approx 220 a month again tax free 

we were told when they took over the would be putting us on a monthly pay which I have not long received there was also a small wage rise included ,      I was paid 476 pounds for the month and did 2 shifts to cover a co employees absence taking in another 145 pounds ,   So 622 pounds .

on this wage slip my tax code is totally different from my previous code ,  and I got taxed 70 pounds and paid ten pounds into a pension scheme ,
does this sound correct ,    Have I went over some tax threshold ?     There’s not much point in helping the company out absences  if I’m getting taxed on it ?       

Any help appreciated thanks 

Undervalued

johnnyren said:

Hi
     I have a tax issue that has cropped up ,  I’d be grateful for some advice before tackling the tax office if needed ,  it’s a bit confusing so I’ve tried to put it as simply as I can.

I am taking 1400 pounds a month tax free from my pension drawdown .

about 2 yrs ago I took on a small part time cleaning job taking in approx 110 pounds a week which was tax free.

The company changed hands a few months ago and put us on fortnightly pay , I recorded approx 220 a month again tax free 

we were told when they took over the would be putting us on a monthly pay which I have not long received there was also a small wage rise included ,      I was paid 476 pounds for the month and did 2 shifts to cover a co employees absence taking in another 145 pounds ,   So 622 pounds .

on this wage slip my tax code is totally different from my previous code ,  and I got taxed 70 pounds and paid ten pounds into a pension scheme ,
does this sound correct ,    Have I went over some tax threshold ?     There’s not much point in helping the company out absences  if I’m getting taxed on it ?       

Any help appreciated thanks 

The single person's tax allowance is currently £12570 per year. It was a bit less last tax year.

Your pension alone is16800 per year so you should be paying tax on £4230 of it so at 20% you should be paying £846 tax on your pension this year, £70.50 per month.

So any earned income should attract tax.

johnnyren

Undervalued said:

johnnyren said:

Hi
     I have a tax issue that has cropped up ,  I’d be grateful for some advice before tackling the tax office if needed ,  it’s a bit confusing so I’ve tried to put it as simply as I can.

I am taking 1400 pounds a month tax free from my pension drawdown .

about 2 yrs ago I took on a small part time cleaning job taking in approx 110 pounds a week which was tax free.

The company changed hands a few months ago and put us on fortnightly pay , I recorded approx 220 a month again tax free 

we were told when they took over the would be putting us on a monthly pay which I have not long received there was also a small wage rise included ,      I was paid 476 pounds for the month and did 2 shifts to cover a co employees absence taking in another 145 pounds ,   So 622 pounds .

on this wage slip my tax code is totally different from my previous code ,  and I got taxed 70 pounds and paid ten pounds into a pension scheme ,
does this sound correct ,    Have I went over some tax threshold ?     There’s not much point in helping the company out absences  if I’m getting taxed on it ?       

Any help appreciated thanks 

The single person's tax allowance is currently £12570 per year. It was a bit less last tax year.

Your pension alone is16800 per year so you should be paying tax on £4230 of it so at 20% you should be paying £846 tax on your pension this year, £70.50 per month.

So any earned income should attract tax.

The 1400 I get each month is part of my 25 % tax free drawdown so I’d imagine that’s why I’m not paying tax on that ,     As I said I wax regularly taking home 110 a week tax free ,     Why am I paying tax cause it’s monthly ?    

And my tax code is different 

lincroft1710

Your total income is over the personal allowance, so if you have a tax free amount over the personal allowance, the any income over the tax free amount will be taxed

johnnyren

lincroft1710 said:

Your total income is over the personal allowance, so if you have a tax free amount over the personal allowance, the any income over the tax free amount will be taxed

lincroft1710 said:

Your total income is over the personal allowance, so if you have a tax free amount over the personal allowance, the any income over the tax free amount will be taxed

Ok so does this throw up another problem ?     Why has my ifa been allowing me to take 1400 per month and for 2 years on this job I haven’t paid a penny in tax till now ,        Who is at fault here ?    

MX5huggy

So you get £1050 of taxable pension and £500 per month of wages which is £18600 per year so you need to pay tax on £5850 this year at 20% which is £1170 tax so £97.50 per month. 

Your P60 or last pay slip of last year  will show your total earnings for that year. 

Dazed_and_C0nfused

johnnyren said:

Hi 
      I have a tax issue which has cropped up and causing a bit of concern 

I receive 1400 pounds per month drawdow from my 25% tax free pension pot 

for 2 years I have had a small part time job paying 110 pounds a week ,  no tax was taken from me .

4 months ago the company changed hands and we went to fortnighly pay , my wage is now 220 pounds again no tax taken 

last month the company put us on monthly pay ,  there was a wage rise in it and I got about 500 pounds and was taxed 70 pounds and my tax code had changed 

have I crossed a tax threshold somewhere ?    And if so why hasn’t the company worked for took tax previously.     Even my ifa never told me I’d be liable for tax ,      Now I’m worried I’m going to get hit with a backdated bill 

any advice appreciated 

What do you actually mean by the bit in bold?

Can you avoid any ambiguity and just say what the amount of taxable pension income is?

eskbanker

johnnyren said:

last month the company put us on monthly pay ,  there was a wage rise in it and I got about 500 pounds and was taxed 70 pounds and my tax code had changed 

have I crossed a tax threshold somewhere ?

What did it change from and to, and have you seen the derivation of the revised one yet, either on a coding notice or in your online personal tax account?

johnnyren

I have been earning approx 6000 a year for the last 2 years and have not paid a oenny in tax ,     As I said I get 1400
a month which I thought was tax free as it’s part of my drawdown 
why haven’t my employers took any tax ?    I’ve got the wage slips ect.        I think I’m going to have to phone the tax office ,      How will this pan out ,        My ifa even knew I was taking the part time job on and never mentioned tax issues 

molerat

Duplicate thread https://forums.moneysavingexpert.com/discussion/6605504/tax-query