Two Jobs, Tax & NI

Frozennova · 18 Jan 2011 at 08:36

Theres a possiblity I may have a second part time job in a week or two and I'm having difficulty working out how much tax and NI I would be paying at each.

Job 1
£4.99p/h * 24.75 hours = £123.50 before deductions

Job 2
£8p/h * 24 hours = £192 before deductions

Tax code is 653L at 19

Badgi · 18 Jan 2011 at 08:41

I'm not sure exactly how it works, but, I'm pretty sure you pay a higher tax rate on the second job.

tres · 18 Jan 2011 at 08:46

You'll have your regular allowance on the first job, and your second job will be taxed at BR rate - everything at 20% tax.

The fact that they're both part time, means your first job will equate to pretty much your exact tax allowance. The second job will be then properly taxed. In this situation, it works out well.

Vonhelmet · 18 Jan 2011 at 08:48

In theory you should pay a total of about £38 tax and £21 NIC per week across the two jobs. In practise it is frankly anybody's guess and depends on the relative competence of the payroll departments in coping with your having two jobs.

Beerbaron · 18 Jan 2011 at 08:49

you will pay the same amount of tax overall but they may try to take all the tax/NI from one of the jobs.

http://listentotaxman.com/

daver · 18 Jan 2011 at 08:53

653L means you can earn £6539 before you pay tax.

This is 125.75 per week which just about covers your first job so you wouldn't pay tax on that.

The next 30K or so is taxed at 20% so your second job will be taxed at that.

On a total weekly income of 315.50 you should pay 37.95 in tax a week.

National insurance is levied at 11% (will rise to 12% in April) on all your income above £97 per week (up to a higher limit which you wont reach) so you should pay £24.04 NI per week.

So your net income would be £253.51

On the other hand, if you haven't earned that much this tax year(eg if you didnt start your first job that long ago) you may have some spare allowances which you can reduce the tax on your second job. If this is the case you need to contact the tax office to sort out your tax code at your second job, otherwise it should be BR

Frozennova · 18 Jan 2011 at 09:17

Already pulled in a little over 7k a year, thanks for the help confirmed what I was hoping to hear

tres · 18 Jan 2011 at 09:42

vonhelmet said:
In theory you should pay a total of about £38 tax and £21 NIC per week across the two jobs. In practise it is frankly anybody's guess and depends on the relative competence of the payroll departments in coping with your having two jobs.

I'd disagree with this - 99% of payroll departments don't manually calculate tax/ni. Every system I've used, is completely dependent on the employee filling out a P46 and informing them that they have another job. The systems do the rest (it's usually a single tax code change, then everything is automatic)

Abraham · 18 Jan 2011 at 09:47

your end result should be exactly the same as if you'd earnt it all from one job, come april if your p60's don't total to what they should you go looking for a rebate.

Vonhelmet · 18 Jan 2011 at 11:32

tres said:
I'd disagree with this - 99% of payroll departments don't manually calculate tax/ni. Every system I've used, is completely dependent on the employee filling out a P46 and informing them that they have another job. The systems do the rest (it's usually a single tax code change, then everything is automatic)

I meant theory in a very longview sense, and I concede I shouldn't have slammed payroll so much. They are most likely to put one of the jobs on BR, which is the right thing to do under the circumstances, as they can't have enough detail to recalculate his allowance without getting info from the other employer.

tres · 18 Jan 2011 at 11:52

vonhelmet said:
I meant theory in a very longview sense, and I concede I shouldn't have slammed payroll so much. They are most likely to put one of the jobs on BR, which is the right thing to do under the circumstances, as they can't have enough detail to recalculate his allowance without getting info from the other employer.

But with a second job, you don't recalculate any sort of allowance. It is purely a BR tax code for the entire year, and it's up to the HMRC to send a P6(T). From a payroll and employee sense, it's relatively straight forward. Only at the financial year end do you look at P60s and apply for a rebate (if poss)

Vonhelmet · 18 Jan 2011 at 11:58

tres said:
But with a second job, you don't recalculate any sort of allowance. It is purely a BR tax code for the entire year, and it's up to the HMRC to send a P6(T). From a payroll and employee sense, it's relatively straight forward. Only at the financial year end do you look at P60s and apply for a rebate (if poss)

That was my point, but I worded it badly

tres · 18 Jan 2011 at 12:38

e-high five!

I frigging hate payroll. Unfortunately it's part of (one) of my jobs. Despite having absolutely no initial training, I was handed a 7 figure annual payroll to run!