How does the British tax system work?

Don’t ask us, we just pay our taxes we don’t understand the system. If I knew the answer I’d probably have found a way around it by now

Don’t know wether this helps

Income Tax Rates

TAX RATE INCOME RANGE AFFECTED
10% £0-£2,020 of taxable income
22% £2,021-£31,400
40% £30,401 and above
There are three bands of income tax. Your taxable income is the amount you earn minus your personal allowance .

The first £2,020 of your taxable income is taxed at 10%.

The next £29,379 is taxed at 22%.

Any further earnings are taxed at 40%.

My last gross was £31,412 just over so that is why I now pay the MAX…….. bummer

A225HVY

Thank you guys for the answers.

Tax isnt complicated at all. You earn money and you give it to the government 😎 But details are still complicated. I think I will need an agent :p
None the less thank you for the answers.

With my forces pension and salary I’m on around £31K a year and my pension is taxed @ 40% by the robbing government…..did my time and they still want to screw you!!

A225HVY

[INDENT]up to £4,745 tax free
between £4,745 – £6,765 10%
between £6,765 – £36,145 22%
over £36,145 40%[/INDENT]

naaa something is wrong with that last figure, my basic pay falls in the 40% bracket and is reflected on my self assessment form I have to fill in every year, the figures I quoted above come direct from the government website.

I guess your figures Don are for working travellers as you say but bperucco said he wants to relocate and not exactly travel to this country on a working visa?
Maybe there is some difference

The 40% bracket is anything above 33k I thought, I pay 40% tax and have to fill out a friggin tax return so I have a pretty good idea how it works ( I think HAHA )
Basically the 40% bracket means you pay 40% on anything ABOVE 33k, it does not make your whole earnings pay 40%, also it is calculated based on your frequency of pay so if you get paid monthly it gets calculated on that, if you get paid weekly then it is calculated on that and so on, if you earn 3,000 per month then you will pay 40% on 250 pounds of that and anything you earn above 3000 because after you earn 2750 pounds per month this means your earnings would be over 33k pro rata, does that make sense?

The Tax bands are

Starting rate 10% 0 – 2,150

Basic rate 22% 2,151 – 33,300

Higher rate 40% over 33,300

So even if you earn 60,000 per year these tax brackets apply, the 1st 2,150 pounds you earn will be taxed at 10% and so on

Dean

I thought the 40% came in around 37k.

Tax is easy you earn money and give it to the government!

follow them websites!

I doubt anyone actually knows 😉