To be annoyed at the new tax brackets?

Absolutely. It is worrying that there is such a poor level of comprehension.

How are you paying 40% tax if you earn £45500? ... not according to government website

I honestly don't believe that those who thought this was a 12k decrease actually earn enough money to have been caught up in it.

Does OP seriously think if the thresholds had changed that much it would not have been big national news?

Or check the previous year on the webpage and see it was the same 🙈

And earning those wages!! Scary

Wow. I am pretty disgusted by some of the comments here.

There's many, many reasons why this topic can be confusing and stressful for some people.

It doesn't make them stupid or dumb or illiterate.

Honestly, how nasty.

I guarantee there's many things some of you find extremely difficult that others find easy. I hope no one sneers at you, when you are struggling.

I can see where op got confused. It does read as an awful increase if you don't read it slowly and in context, but honestly there would have been an outcry had it been true.

My husband's tax code dropped dramatically when he got his state pension because they had to take all the tax from his private pension as there is not a mechanism to tax the state pension. So he gets his state pension tax free but his other pensions he gets no allowance on one and only a couple of thousand on the other.

yes, I remember having to double check it a few years ago because of the way it was worded.
key point - I thought 'this sounds a bit off, let me check I understand'
rather than running to social media DECLARING something had happened and would be 'affecting so many people.'

i.e. anyone can be forgiven for initially making a mistake or not understanding something, but surely the first step is to double check you are correct, not start moaning and fear mongering about something you don't understand....

didn't you think it would be all over the news, people would have mentioned it in real life, etc.?

Yes it's awful. It's 42% and at just under £44k and services are awful.

@NewJobityJob I can see this is pickling your brain. See if this makes sense for you -

(For simplicity, let's say you earn exactly £46k and MI is exactly £5k.)

----------

John earns £51k per year (£46k plus £5k). His tax code is the standard 1257L.

This means he pays 20% tax on earnings from £12,571 to £50,270 and 40% tax on earnings from £50,271 to £125,100.

On a salary of £51k, he would be taxed:
20% on £37,699 (£50,270-£12,571)
40% on £729 (£51,000-£50,270)

----------

You earn £46k and receive £5k of medical insurance.

Your tax code is reduced by £5k to 757L.

This means you pay 20% tax on earnings from £7571 to £45,270 and 40% tax on earnings from £45,271 to £120,100.

On a salary of £46k, this means you are taxed:
20% on £37,699 (£45,270-£7,571)
40% on £729 (£46,000-£45,271)

It is exactly the same. 🤗

I also understand the confusion - vipers nest on here tonight 😩

Loads and loads of people opt out of employer medical insurance and even pension contributions because they want more net pay.
The other issue is freezing of when people start to pay 40% despite inflation so more and more people have an upper rate of 40% plus 2% NI. That is very very high a tax rate for a country so highly taxed in so many other ways.

From 2025 it's 40% on > £37k dropped from £50k

No, it isnt. At ease.

When you get back to them, also tell them they will not get their state pension at age 60, but up to 7 years later.

@Theimpossiblegirl

you have the first £12570 at 0% then the next £37k and 20% etc

the tax brackets have not changed

So are you suggesting that companies should ignore tax law?

No absolutely not! Think they should change the tax law to give everyone a tax break on Employers providing private medical insurance!

It just seems like a win win!

Employees get treated quicker better for them, better for their employer & taking some pressure off the NHS! 🤷‍♀️

I'm currently on a Month 1 K code as a result of in tax year 2023/4 having property income plus interest on an inheritance (at a time when interest rates were high) which I took time to invest tax efficiently. I know that my tax code for 2025/6 will initially be wrong because interest rates have fallen and I have reduced my taxable savings, plus I am probably overpaying tax for this year, so my plan is to get my self-assessment return for 2024/5 in as soon as I can to stop my take home income yoyoing.

You sound like a lovely person!

Unless you work through an umbrella contract - in which case you get to pay Employer's NI and Apprenticeship levy too.
Still, I assume that's something Rachel Reeves didn't study in opposition - when she says that workers won't lose out, over 500,000 will.

Another tax idiot strikes again! No one £45k it doesn't affect you.

Why don't they teach tax in school it would save an awful lot of embarrassment!

"Surely getting treatment quicker is a really good thing!"

Only for the person who can afford to get seen quicker. It doesn't mean it's of any benefit to the NHS, in fact mostly the opposite.

theboar.org/2025/02/wes-2025-does-private-healthcare-undermine-or-uplift-the-nhs/

No. Look at how much you have received in total from your employer. Salary plus medical insurance. You are paying the same amount of tax as everyone else who receives that amount in their salary alone. The only reason your tax code is reduced is so tax can be applied to that £5k because it isn't being taxed within your salary. You are not being taxed more than anyone else.

You are overthinking and confusing yourself. Your tax code is actually irrelevant although I know that sounds strange, it’s just how they collect it rather than your actual tax free amount.

Income:
5k medical insurance plus 45k salary. 50k total income. 12570 is still tax free & the other bands remain the same as everyone else.

The 5k isn’t physically paid over to you so they can’t tax it that way like they would if it was a bonus for example, so instead reduce your tax code to collect the same amount of tax from your salary.

You still get 12570 tax free.

I think I’m the only one on the thread so far who has admitted to being an accountant and I certainly did not give a sneery response. We are used to explaining things in simpler terms for our clients who are not accountants, literally our job, so I doubt many (if any) of the sneery responses were from accountants.

OP, your mistake is a very common one. Not sure why it’s riled everyone up.