Pay Rise/Tax Question

If your pay goes up by 2% this month and the tax rate drops from 22p in the pound to 20p in the pound in the same month. How much is your actual pay going up roughly in pecentage terms this month?

 

I understand the 10% band and wasn't referring to that. So anyone in that the main tax band is actually getting roughly 2% more in their pay packets + whatever pay rise they are offered, so if you get a 2% pay rise, in real teams your wage for April will be 4% better. We're talking roughly, obviously.

What's inflation claimed to be at?

 

5.5% genuine, think the government has it at 2.5% but could be wrong on that.

 

that 5.5%? does that take into account the retail price index?

 

I find it incredible that people are sucked in by the European inflation rate we use, which is based on items like furniture, plasma TVs etc., not exactly items we buy every year let alone every week. Excluded are food, petrol, council tax bills, etc.

 

I don't think many people believe that inflation is 2.5%. I thought real inflation was way more then 5.5% that's why I asked.

 

But you aren't paying 2% less tax because of the reduction of the 22% tax rate - it still depends on what you were earning in the first place, as the 10% tax rate was on the first X amount that you earned and then 22% after that....you didn't pay 22% on all your taxable income.
But, I noticed that my tax code had changed this month (a higher figure so allowance increased), NI paid had reduced and tax had reduced.....I was about £20 a month better off, which isn't that much as to be so noticeable when compared to people who are worse off....heard one on the radio yesterday that said they had £50 a week to live off and were £10 a week worse off, not sure if the £50 figure was before or after being £10 worse off, but either way that is quite a chunk, they should have left the rates as they were.
I don't see how these measures announced yesterday help either....talk of increasing minimum wage won't help those worse off by the tax changes who were earning over the minimum to start with, and also shifts the onus to companies to compensate these people.

 

ah, I didn't realise that at all. Thanks for that Farnham, I've never understood income tax/NI calculations very much. I've just generally multiplied my gross by 0.75 and that's always roughly worked out.

I suspect inflation is Daveys fault.

 

It's boll*cks isn't it. Increasing minumum wage is just passing the buck to employers and whilst I applaud the minimum wage introductions, I think the Government is using it as a get out clause when it suits them. Making people apply for tax credits to cover short falls is disgusting to say the least. People should not be made to feel that they have to ask for handouts because the tax changes is crippling them.

Gordon Brown was possibly the worst chancellor this country has ever seen and is likely to ever have.

 

it is

400k for Mostto

 

www.listentotaxman.com might help

 

Did you find out the answer to this mate? I couldn't do the calculation from the top of my head but I came across this site when I had to do my own tax calculations and it's good quality stuff: https://www.income-tax.co.uk/

Hope it's useful for you too