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Back-dated pay and Tax return

(10 Posts)
YBR Sun 19-Feb-17 06:40:06

I am due a payrise - my direct line manager and 2 bosses above have signed it off but they are having a battle with HR at the (Paris) head office. I don't understand why.

They have told me it will be back-dated to November (that's how long it has taken so far). Does anybody know what happens if it doesn't get done for my March pay packet w.r.t. my tax return as it will then not land in the tax year it ought to have.

JoJoSM2 Sun 19-Feb-17 18:40:30

I imagine you pay tax on money that you've actually been paid. Not a promise of it. I think tax will be due in whichever tax year you actually get paid.

HSMMaCM Sun 19-Feb-17 18:47:04

If it's not paid in March, you'll just get taxed on it next year. If this means you going into a different tax bracket, you could ask them to pay you an advance in march. They might agree to that.

Moanyoldcow Sun 19-Feb-17 22:00:02

An advance wouldn't help as it would be paid net. Your gross pay (for tax) the following April would have the backdated pay added to the gross and have the advance deducted after tax.

You need to get them to pay you in March if there is a risk you'll go into another tax bracket.

HSMMaCM Sun 19-Feb-17 23:15:41

Could get a gross pay advance. Not just a net pay loan. But I agree, try and get it in march, unless it's beneficial to get it next year.

StereophonicallyChallenged Sun 19-Feb-17 23:26:47

New RTI rules mean that all (Paye) pay has to be reported to Hmrc at the time it is actually paid. An advance is no longer allowed at all.
OP, are you actually an employee with other income/reasons that require to complete a tax return or are you self employed (or a contractor) status?

HSMMaCM Mon 20-Feb-17 07:40:54

Apologies my knowledge is out of date then.

Oblomov17 Mon 20-Feb-17 07:44:01

Interesting. I never knew about the RTI rule either.

YBR Mon 20-Feb-17 11:06:35

Thanks. That makes it simple - I just have to do the Tax Return on what gets paid and when. I was afraid that it would get complex that the rules would put it as part of this year's income even if didn't reach me until next tax year.

I am an employee and paid around the threshold of Child Benefit tax-back. Last tax year I fell below it once pension and gift-aid had been taken into account but it depends on overtime payments, Christmas working bonus, and how much gift-aid I can find evidence for.

StereophonicallyChallenged Mon 20-Feb-17 22:15:37

Okie doke then OP, so you are Paye with (another) reason to file a return.

So yes, the income will only need to be declared in the year you are paid and receive it even if it is backdated pay smile

Hope that makes sense, it's late, am tired!

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