Issues with tax code

sultan123

eskbanker said:

sultan123 said:

eskbanker said:

If your gross pay so far was £36,618 and you'll also be taxed on £300, you need to keep your remaining income below £63,082, i.e. £6,308 a month.

If your monthly gross of £8,010 is after 8% sal sac, then the unadjusted figure would be £8,706, so you'd need to sacrifice 28% to get that below £6,308 each month.

This assumes you can notify in time to take effect from your June pay - if you couldn't get your pay adjusted until next month then you'd need to tweak the above calculation....

Thanks 28% seems high? are you sure this is correct

Feel free to point out where you believe I've gone wrong!

Sorry I think I may have misunderstood. So 28% every single month instead of 8% is needed? So basically I need to do another 20% each month of salary sacrificing?

Dazed_and_C0nfused

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

sultan123

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

QrizB

sultan123 said:

eskbanker said:

sultan123 said:

eskbanker said:

If your gross pay so far was £36,618 and you'll also be taxed on £300, you need to keep your remaining income below £63,082, i.e. £6,308 a month.

If your monthly gross of £8,010 is after 8% sal sac, then the unadjusted figure would be £8,706, so you'd need to sacrifice 28% to get that below £6,308 each month.

This assumes you can notify in time to take effect from your June pay - if you couldn't get your pay adjusted until next month then you'd need to tweak the above calculation....

Thanks 28% seems high? are you sure this is correct

Feel free to point out where you believe I've gone wrong!

Sorry I think I may have misunderstood. So 28% every single month instead of 8% is needed? So basically I need to do another 20% each month of salary sacrificing?

If the figures you have shared so far for "gross pay" are what's remaining *after* your existing 8% salsac, then I think you need to sacrifice a further (28% of 92% = ) 26% on top - so 34% total.

If your figures for gross pay are *before* 8% salsac, then the calculation will be different.

Dazed_and_C0nfused

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

sultan123

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

How did you work out employer contribution without knowing the % my employer contributes towards my pension?

If they drop to £6060.60 a month what wiill my rought monthly take home be post tax and NI?

Dazed_and_C0nfused

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

How did you work out employer contribution without knowing the % my employer contributes towards my pension?

If they drop to £6060.60 a month what wiill my rought monthly take home be post tax and NI?

The employer contributions I was referring to was what would be paid as a direct result of you sacrificing 30% of £8,658 each month.

Any normal employer contributions would be in addition to that.  As would any of the employers NI saving they might choose to share with you.

I'm sure someone earning £100k can find a tax and NI calculator using Google.  Or the links which were probably provided by posters on one of your other threads.

sultan123

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

How did you work out employer contribution without knowing the % my employer contributes towards my pension?

If they drop to £6060.60 a month what wiill my rought monthly take home be post tax and NI?

The employer contributions I was referring to was what would be paid as a direct result of you sacrificing 30% of £8,658 each month.

Any normal employer contributions would be in addition to that.  As would any of the employers NI saving they might choose to share with you.

I'm sure someone earning £100k can find a tax and NI calculator using Google.  Or the links which were probably provided by posters on one of your other threads.

30% of 8658 = £2597 a month. Times that by 10 months left of tax year is £25970 vs £23376 you mention?

Is it best to salary sacrifice via workplace pension or do payment into SIPP? Guess SIPP will not save me NI payments though?

Dazed_and_C0nfused

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

How did you work out employer contribution without knowing the % my employer contributes towards my pension?

If they drop to £6060.60 a month what wiill my rought monthly take home be post tax and NI?

The employer contributions I was referring to was what would be paid as a direct result of you sacrificing 30% of £8,658 each month.

Any normal employer contributions would be in addition to that.  As would any of the employers NI saving they might choose to share with you.

I'm sure someone earning £100k can find a tax and NI calculator using Google.  Or the links which were probably provided by posters on one of your other threads.

30% of 8658 = £2597 a month. Times that by 10 months left of tax year is £25970 vs £23376 you mention?

Is it best to salary sacrifice via workplace pension or do payment into SIPP? Guess SIPP will not save me NI payments though?

You started this thread by explaining your pay for the first three months of the tax year (to the tax month ending on 5 July 2025).  That leaves 9 months of the tax year.  £2597.40 x 9 = £23,376.

You get pension tax relief if you contribute to a SIPP(25% of what you pay over, which is 20% of the gross contribution).  But you need to claim the additional higher rate relief from HMRC.  And, yes, you would not save any NI.

Salary sacrifice is generally considered the best option as you don't have to involve HMRC (you can never claim any pension tax relief on employer contributions) and get an NI saving.

Note personal contributions to a SIPP are made using the relief at source method and these do not reduce your taxable income.  They do however reduce your adjusted net income and it's adjusted net income which determines your Personal Allowance.

sultan123

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Dazed_and_C0nfused said:

sultan123 said:

Anyone help?

What do you mean by gross salary?

HMRC have no interest in your salary, it is your taxable pay which is important.

Is the £27,850, £8,768 and £8,010 the taxable pay value i.e. your payslip in the tax month to 5 July 2025 will show your taxable pay as £44,628?

No one will be able to tell you what % to sacrifice as you haven't told us what your taxable earnings, pre any salary sacrifice, are expected to be for each of the remaining 9 months of the tax year.  

But it would be possible to say what you need to restrict your taxable earnings to go avoid any reduction in the Personal Allowance.

that is the money I get (after salary sacrifice) and then rest is deducted to tax and NI to give me my net pay.

The grosses I have given so far are my gross earnings for the year so what do I need to do to get below 100k is my question as it seems I will be making 116k gross in this tax year (salary sacrifice included within this estimation)

If you have earned (taxable income) £44,628 by month 3 of the tax year and will have £300 in company benefits that is a total of £44,928.

Leaving you £55,072 you can earn in the remainder of the tax year before breaching the £100k threshold.  An average of £6,119 I'm taxable pay each month that remains.

The above assumes you don't make any Gift Aid donations or contribute to a pension yourself using the "relief at source" method, for example contributions to a personal pension or SIPP.

Thanks but how much do I need to %salary sacrifice into workplace pension for remaining 9 months ro keep under 100k

With all due respect as you failed to provide details of what you will earn each month, pre salary sacrifice, how do you think it is possible for someone to calculate that?

You have told us about three payslips so far this year and you earned a different amount each time so although @eskbanker had provided a perfectly reasonable explanation it is making an assumption about what you will earn each month.

Sorry about that.

So from June till end of tax year (march next year) I will be earning £8658 a month pre salary sacrifice.

My query is how much more should I salary sacrifice a month from this month onwards to get below 100k and save all of my personal allowance

I would go with 30% as that allows for a little margin of error, for example you receive some (taxable) interest or the P11D benefit is slightly more than £300.

£8,658 with 30% sacrificed means your taxable earnings will drop to £6060.60 each month.  So an extra £54,545 taxable pay over the next 9 months.

And you will get employer contributions of £23,376 added to your pension in that time.

How did you work out employer contribution without knowing the % my employer contributes towards my pension?

If they drop to £6060.60 a month what wiill my rought monthly take home be post tax and NI?

The employer contributions I was referring to was what would be paid as a direct result of you sacrificing 30% of £8,658 each month.

Any normal employer contributions would be in addition to that.  As would any of the employers NI saving they might choose to share with you.

I'm sure someone earning £100k can find a tax and NI calculator using Google.  Or the links which were probably provided by posters on one of your other threads.

30% of 8658 = £2597 a month. Times that by 10 months left of tax year is £25970 vs £23376 you mention?

Is it best to salary sacrifice via workplace pension or do payment into SIPP? Guess SIPP will not save me NI payments though?

You started this thread by explaining your pay for the first three months of the tax year (to the tax month ending on 5 July 2025).  That leaves 9 months of the tax year.  £2597.40 x 9 = £23,376.

You get pension tax relief if you contribute to a SIPP(25% of what you pay over, which is 20% of the gross contribution).  But you need to claim the additional higher rate relief from HMRC.  And, yes, you would not save any NI.

Salary sacrifice is generally considered the best option as you don't have to involve HMRC (you can never claim any pension tax relief on employer contributions) and get an NI saving.

Note personal contributions to a SIPP are made using the relief at source method and these do not reduce your taxable income.  They do however reduce your adjusted net income and it's adjusted net income which determines your Personal Allowance.

Sorry that is all clear now. Thanks for explaining.

Will hmrc reduce my tax code back to 1257L then if i salary sacrifice 30% into my pension? 

What is the maximum i can put into my pension in tax year? 60k? Does that include employer and employee contributions or just employee? Does it also include the growth of the pension?