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I paid - You paid the right amount of Income Tax for 6 April 2017 to 5 April 2018


You paid £10,288.71

I did not think it would be so much, all at 20%? I earned around £40k(including a one-off sum), personal allowance is £11,500?

Around £30k of taxable income, so is that because of NI?

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Posted (edited)
19 hours ago, El Cid said:

I paid - You paid the right amount of Income Tax for 6 April 2017 to 5 April 2018


You paid £10,288.71

I did not think it would be so much, all at 20%? I earned around £40k(including a one-off sum), personal allowance is £11,500?

Around £30k of taxable income, so is that because of NI?

I remember when on wage packets, I didn't really notice the NI as it was so little. I was concentrating on the tax paid! It's sneaked up over the years , I think! :)

 

That's about right.

 

The tax calculator shows about 6k tax and 4k NI on 40k

Edited by *_ash_*

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On 03/03/2019 at 10:34, *_ash_* said:

I remember when on wage packets, I didn't really notice the NI as it was so little. I was concentrating on the tax paid! It's sneaked up over the years , I think! :)

 

That's about right.

 

The tax calculator shows about 6k tax and 4k NI on 40k

it became politically difficult for a chancellor to change the basic rate of income tax back in the 1980's, as a few  parties made promises not to change it and the remaining parties were basically forced to follow suit to avoid bad headlines.

 

parties, like the lib dems, which promised a rise also made a firm commitment that the extra raised would be ringfenced for a specific cause, like th NHS.

 

having promised nothing about NI, sucessive chancellors have used that to fill the gaps in finance caused but not increasing the base rate of income tax

 

also, due to the different way it's calculated a relatively small increase in NI rates raises as much as a larger rise in income tax rates would do

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Whilst NI has been increased consistently since the 1980's, it looks like income tax has actually been reduced (at least since 1990)

 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/709417/Table-a2.pdf

 

 

Is it calculated differently?  It has a lower limit and an upper limit, and between those a % rate.  That's basically the same as a tax band.  The band is lower though, so currently NI is payable on income over £162/week, or £8424a year.  At 12%.  Up until £892/week or £46384.  And above that it's just 2%.

 

So very much like income tax, but with a broader initial bracket and then a much lower higher rate (so it looks like a highly regressive tax structure on it's own).

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36 minutes ago, Cyclone said:

 

Is it calculated differently?  It has a lower limit and an upper limit, and between those a % rate.  That's basically the same as a tax band. 

income tax is calculated cumulatively over the year, ni is calculated on a per payment basis

 

 

 

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Fair enough, but for the majority of people that won't alter anything will it?

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