Mid year pay rise moving to higher income tax rate. What effect on interest earnings?

Kim_13

Dazed_and_C0nfused said:

Watson_203 said:

Kim_13 said:

Watson_203 said:

Thank you for all your replies! I'd not thought about interest being income on top of my salary and also that pension, NI and student finance would be untaxed.

Looking at the MSE Income Tax Calculator my "Taxable Wage" would be around £34,000 with a guesstimation of what my pay rises will roughly end up looking like. Therefore I should always be in the regular income tax threshold and this whole thing isn't even a problem.

Thanks again for your help and suggestions!

If I’m not mistaken Student Loan Repayments don’t reduce your taxable earnings - but your payslip should say what your taxable pay to date is. Add that figure to any taxable interest, dividends etc received since April 6th and that would be your taxable income for 25/26 to date.

You're right, student loads don't reduce them! I just lumped it in with the stuff that does.

Even then I still think my taxable earnings will still be very much below the higher threshold.

This all started because I failed to read "taxable" on the income tax table.

Thanks again!

Taxable has different meanings.

Some people ignore the Personal Allowance when stating what their taxable income is.  But that would give an incorrect figure in most people's eyes.

So is your taxable wage genuinely around £34,000 or is it really ~£46.5k? 

Your payslips almost certainly show your taxable wage (pay).  

In my eyes if you ignore the Personal Allowance when stating income, you are stating your taxed income - because that’s how much you have paid tax on. Taxable income is all income you’re potentially liable to be taxed on (so this would exclude interest and gains made within ISAs.) How much tax you owe is then calculated by applying any Personal Allowance (because it will be lower if you earn over £100k, or transfer to a spouse) and other allowances available.