What PAYE Amount Should I Use From April 2019?
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MarkOnline
Posts: 19 Forumite
in Cutting tax
Hey guys, and let me say thank you upfront for any advice you can give.
For this past year (18/19) I was inputting £702/month as my employee earnings as this was the maximum amount to use without having to pay tax - and also using tax code 1185L. I think this is called Optimum Director’s salary or Primary Threshold for NI.
* And just to clarify, this is to avoid both income tax and employee NI contributions (not just income tax). *
So I'm just wondering from April 2019 what would the new amount be? To avoid income tax and employee NI (the rest of my income being issued as dividends).
Also, I'm sure I'll have to change my tax code change from 1185L? Am I right in thinking it’s 1250L this year? (add 65 to 1185L). I will need to input the new code in the Basic PAYE Tools program I use.
Pardon my ignorance on this and thanks for any help.!
Mark
For this past year (18/19) I was inputting £702/month as my employee earnings as this was the maximum amount to use without having to pay tax - and also using tax code 1185L. I think this is called Optimum Director’s salary or Primary Threshold for NI.
* And just to clarify, this is to avoid both income tax and employee NI contributions (not just income tax). *
So I'm just wondering from April 2019 what would the new amount be? To avoid income tax and employee NI (the rest of my income being issued as dividends).
Also, I'm sure I'll have to change my tax code change from 1185L? Am I right in thinking it’s 1250L this year? (add 65 to 1185L). I will need to input the new code in the Basic PAYE Tools program I use.
Pardon my ignorance on this and thanks for any help.!
Mark
0
Comments
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All the information you need to arrive at the answers to your questions is available here.
https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2019-to-2020#paye-tax-and-class-1-national-insurance-contributions0 -
Every thread you have posted pretty much asks the same questions year on year.
Have you ever wondered why you, as the employer, arent receiving the tax code information for you, as the employee, from HMRC?
You should be getting a document called P9X which explains how an L tax code should be increased (where no separate notification is received).
Have you checked your Personal Tax Account to see that your state pension entitlement is increasing each year as I presume you expect?
Something doesn't seem right somewhere and I wonder if you are in for a nasty surprise somewhere along the line?0 -
For this past year (18/19) I was inputting £702/month as my employee earnings as this was the maximum amount to use without having to pay tax - and also using tax code 1185L. I think this is called Optimum Director’s salary or Primary Threshold for NI.
£719.33 for 2019/20 to give £8632 for the year.
(£702 for 2018/19 gave £8424 for the year.)I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
My accountant has recommended £715 for the new tax year.0
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TheCyclingProgrammer wrote: »My accountant has recommended £715 for the new tax year.
I was told £715 yesterday by someone also. Did your accountant clarify that this amount was enoughso that it counts as a years ‘stamp’ for your national insurance history to help protect your future entitlement to state pension?
Many thanks0 -
MarkOnline wrote: »I was told £715 yesterday by someone also. Did your accountant clarify that this amount was enoughso that it counts as a years ‘stamp’ for your national insurance history to help protect your future entitlement to state pension?
Many thanks
Yes, it's well above the LEL.0 -
MarkOnline wrote: »Did your accountant clarify that this amount was enoughso that it counts as a years ‘stamp’ for your national insurance history to help protect your future entitlement to state pension?
You definitely don't need to ask that question as it's a simple look up in the link that I posted previously.0 -
I wonder if the op is actually using Basic PAYE Tools to send the payroll information to HMRC or not bothering as there's no tax or National Insurance to pay?0
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MarkOnline wrote: »I was told £715 yesterday by someone also. Did your accountant clarify that this amount was enoughso that it counts as a years ‘stamp’ for your national insurance history to help protect your future entitlement to state pension?
Many thanks
Have you checked your NI record to ensure it is getting updated ?0 -
All the information you need to arrive at the answers to your questions is available here.
https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2019-to-2020#paye-tax-and-class-1-national-insurance-contributions
That link gives £719 for the primary and secondary threshold, so why are some suggesting £715?I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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