The Rig

iTrader: (13)

As im an I.T Contractor, i get paid slightly different to most, but i got paid £17 less this week, kicke doff and he comes back with since the national wage was increased we are taxed more hence the drop in salary WTF

so, the NMW goes up, my take home goes down is this right, or is he ball aching me ?

Buster-WRX

Sounds like he,s having you off fella.

Have a quite word

stevey

iTrader: (2)

tax is paid on your total wage has this gone up if so you will pay more tax

GazTheHat

As an IT contractor, £17 shouldn't bother you, that's like taking a ****

The Rig

iTrader: (13)

Nah, im not a highly paid contractor matey !

just checked, my basic before all their crap has gone up by £19, hence why im now taxed more and earn less, how phucked up is that, im now worse off due to a salary increase,thats the government for ya, t00sers !!!!!!11

GazTheHat

You must've just gone over a tax banding.

Time to claim on expenses for a job interview 300 miles each way

WHEELSHOP0_0

More top line should mean more take home surely as you are only taxed on the percentage of your wage that is in each tax band, eg. your first £100 no tax=£100 take home, Next £100 taxed at 20%=£80 take home,next £100.taxed at 25%=£75 take home, next£100 taxed at 40%=£60 take home. so total top line £400 total take home= £100+£80+£75+£60 =£315.
These figures are NOT accurate but for demo purposes only, It made sense in my head, I hope this helps.

Jimpreza

Totally agree unless your tax code has changed

Abx

iTrader: (15)

I'm a payroll manager and a payrise in no way would mean you take home less pay, there is a formula used when calculating tax to stop this from happening, its called the Poverty Trap.

Even if this payrise pushed you into the 40% bracket you would only pay tax at 40% on earning over the threshold, currently the higher tax threshold is £33000 per annum, tax is also calculated on a cumlitave basis (assuming your on the right tax code, generally something like 503L shown on your payslip) which means you will only pay tax on earnings over £16500 to date (again assuming your talking about salary paid in month 7, September).

Anything else give me a shout or there is a pay calculateor on the HMRC website which is pretty user friendly!

MazingerZ

why dont you share that websites with all of us?

so for example what would be the difference in the take home wage between £32000 and £33000 could you please break it down to understand it better?

cheers
Koji

crazyman1979

I am an IT contractor in the same boat, what happens to me is that i am only payed minimum wage at normal tax rate, the rest is payed through dividends which occurs a lower rate of corporation tax and no NI.



I use these guys for over 80% takehome of my gross http://www.giantgroup.com/ this if from their FAQ's.

StickyMicky

This min wage going up thing is a load of ****.

I am putting my prices up again at new years eve, and so is everybody else that i know of, where will it stop

BlueSimon

OT, Sticky - whatracer name do you use in LFS?

Im FlintFredstone / TroyMclure

Simon

Abx

iTrader: (15)

Koji

Ok, assuming again that you are a normal person NOT receiving any other benefits such as Bupa, critical illness etc, you have as follows:

32k per annum
Gross 2666.66
tax 472.61
NI 247.13
Net 1946.92

33k per annum
Gross 2750
tax 491.09
NI 256.30
Net 2002.61

The HMRC website is www.hmrc.gov.uk and does have a few useful tools for you to use.

Basically for every £ you earn over the 40% tax bracket you will take home about £50 after tax and Ni deductions.

let me know if you need anything else.
Arron

MazingerZ

cheers mate!

Abx

iTrader: (15)

No worries mate, and Crazman I can vouch for Giant, I have worked with the manager there and he's a good lad!

stevebennett

depends if you are a sole trader or a one man band limited company.

But these loopholes are slowly closing but i thought that they had been closed since April 2006

The Rig

iTrader: (13)

Funny enough i am with giantgroup.

basically, i have been told its nothing to do with poverty trap etc.

We offset pay against non-billable expenses. The maximum amount we can offset is based on the minimum wage legislation AND the amount our contractors have to pay tax and NI on is on the minimum wage. Therefore if the minimum wage increases then so does the amount tax and NI has to be paid on. In addition the HMRC calculators are based on PAYE, not limited companys where expenses can be offset. Again I apologise for any inconvenience caused but we are unable to change this

The Rig

iTrader: (13)

so, after all the minomum wage increase, im worse off, nearly £100 a month !

StickyMicky

O/T
"Sticky-Micky"

back to the mongos on min wage

GC8

Mick, youve turned into a right capitalist oppressor, havent you, eh?

Abx

iTrader: (15)

Sorry if your being paid through someone like Giant then my explanation may not be applicable, the above is correct if your being paid paye and paying full tax and NI as an 'employed' person. Giant should be saving you quite a bit, you'll certainly be paying less tax than if you were paye.

As far as I know the loopholes are still ok, many have been closed but as soon as one is another opens!

doppelganger

there is an article in the daily mail today about just this topic ,basically earn £1000 more take home £300 of it tax = 70%

GazTheHat

IR35