AIBU mat leave and tax

[TaxIssues2022222]

Sorry to be dense, I've name changed for this but just need a quick answer.

I've worked for a company for 10 years, currently on mat leave. We get 6 months full pay, 3 months statutory mat pay and 3 months unpaid totalling the max 1 year off. I dont want to return to work during this time as my job is very rigid monday-friday 9-5 type job so won't work with childcare etc. But we might get short of funds so I thought maybe I could work in the evenings at a different temporary job during the final 3 unpaid months of mat leave.

My husband believes this will mean I'm taxed at 20% on all earnings at this job as my tax free allowance is used on my main job even though I won't be earning during that time. I'm not sure that's right but have no idea. Anyone care to enlighten me? Thanks

At what point in the financial year do you drop to nil pay?

It probably depends where you are in the tax year and whether your pay has exceeded the personal tax allowance. You can reclaim overpayments at the end of each tax year. Is it realistic to return after 12 months and would you repay the omp element if not ?

I will be returning to my job after the 12 months yes, but at reduced hours at that point maybe 3 days per week if I'm allowed.

I'll be dropping to nil pay from October this year. I dont think I'll be over the tax threshold for 2022/2023 tax year - thats a good point.

I don’t know the answer to your question but just make sure you don’t start in the new job until your SMP has expired or you will lose your right to SMP

HMRC can split your tax code between 2 jobs, so you would need to contact them and advise them what you are earning in each job.

Tax will be deducted by both employers on the basis of the tax code HMRC sends them and instructs them to use. In most cases second jobs have a BR, D0 or D1 code - to answer your question this would mean you pay basic rate tax on anything you earn at the second job which you could reclaim later. So your DH is right about what normally happens.
I am not sure if you could persuade HMRC to give you a normal code for the second job.

Ah so I could reclaim it later but they won't automatically refund me if they pick up I shouldn't have been taxed? I'm clueless at tax. Is it worth telling them I'm about to start a new 2nd job when the time comes to stop it being an issue or will that not make any difference?

I would contact HMRC with every job change so that they can deal with your tax code accordingly. If you overpay tax and your tax code allows for it, it will be refunded.

HMRC are happy to split tax codes between jobs, it happens all the time to employees of my clients.

Check your company's maternity leave policy - some companies don't allow you to work for other employers while on maternity leave from them. I'm not sure if that only applies to the paid bit.

Yes, you can get your tax code split between your employers - although this will draw your company's attention to the fact that you are working elsewhere.

You will pay the same amount over the whole tax year but initially, as you will tick that you have another job so will pay at BR (20%) but it will be adjusted through your tax code over the year when you are back at work, so you won't pay more tax overall.

Thanks everyone. My company is happy for me to work elsewhere when I'm unpaid so thats good.