Tax Question.

[cassa333]

Hi,

Can anyone tell me how much you would need to earn to pay £2,015 in tax please?

I’ve just done my tax return and need to pay an extra £1040 on top of the £975 on my paid employment. The extra income is made up of interest and rental income.

I know the new rental income rules mean you don’t get tax relief on it any more but before I always got a rebate of about £200 so this is very different.

Thanks

[ToraToraTora]

12500 + 5 * 2015 = £22575
assuming single persons tax allowance and basic rate tax at 20%, you would also pay some NI.

[bhg481]

You will need to earn 5 x 1040 = £5200 from any sources other than your paid employment.

[cassa333]

Sorry TTT I'm stumped by your calculation lol.

Is that £22,575 needs to be learnt to pay £2, 015 tax?

Because with my rental income interest and pains employment I earned about £14,000 and that's a liberal estimate.

[cassa333]

Oh thanks bhg. That makes more sense to me lol.

I actually earn £5263 from my paid employment and paid £902 tax on that. I must have an odd tax code because I thought the single allowance was about £10k or something.

[TonyV]

What's your tax code cassa333?

[cassa333]

I don’t know what my tax code is. We don’t get paper pay slips it’s all done on line and I’ve never managed to get to it. In three years I’ve only seen one payslip lol.

[ummmm]

Phone HMRC and ask.

[ToraToraTora]

£12500 is your personal allowance, in order to pay £2015 on your annual income it would have to be 5 times 2015 that(basic tax rate is 20%) plus your personal allowance. I'm not attempting to assimilate any of the above figures, I merely address your first question, to be liable for £2015 tax in a tax year you would have to earn £22575.

[bhg481]

You can earn £12,500 before you start to pay tax. Once you start to pay you are charged at 20% ie, you pay 1/5th of anything you earn above £12,500.
If your total income from all sources is around £14,000 you should pay tax on (£14,000-£12,500) = £1,500, so the tax should be £1,500/5 = £300.

[sunny-dave]

Remember that any State Pension is paid without deduction of tax, but is deducted from your tax free allowance.

[bhg481]

Your tax code is sent to you by HMRC. If you have never received one you should get in touch with HMRC because it sounds like you are being taxed on your total earnings with no allowance. Perhaps your employer is doing something naughty as you should get an annual summary of your earnings and the tax you've paid.

[ToraToraTora]

yes looks like you are not getting your tax free allowance. How long has this been going on? You can go back up to 6 years for a refund from HMRC.

[TonyV]

cassa333 do you not get a P60 each year, you should, that will have your tax code on it.

[fiction-factory]

is there any pension income? Maybe some tax is being recovered from a previous year. you need an online tax account do you can see figures. And you must receive a p60 by law normally.

[Peter Pedant]

well the answer to your question is: nart
5x2015 = £ 10075

this is the gross amount needed to earn a tax bill of £2015
and that was NOT asked
how much do you have to earn so that after tax on that whack you have £2015 clear profit so you can pay a back tax bill

£2015 / 0.8 which is around £2550 give or take
and it works out - earn 2550 and you pay tax on that as 20% 500 knicker give or take
and that leaves £2015 to pay the back tax owed

You seem to be doing your own tax form
for rent you need UKP 1 and 2,
and then you will see various boxes for expenses - legal, insurance and so on
mortgage interest repayments which were claimable are being tapered - and I dont know if they are not now at all reclaimable.

[New Judge]

//The extra income is made up of interest and rental income.//

You pay no tax on the first £1,000 of income earner via interest (provided you pay tax at the basic rate).

The calculations for this should be straightforward but all the information is needed. You need to know your income from your employment, interest, rental and any pension - State or private - income you have (all gross figures). You also need to know whether you have any exceptional allowances (other than the personal allowance of £12,500). Your tax code would help. If you have any income from share dividends the first £2,000 is tax free. Income above that is taxable.

[cassa333]

OK. A bit of an update on my tax situation.

I thought I owed the tax man £1041.00 However it turns out it was the other way around. Just discovered it has been paid into my account already.

I only paid about £900 in tax for my paye job so don’t know how they managed to give me back more than I paid!!

But I’m not complaining lol

In any case than you for all your help.