To be annoyed at the new tax brackets?

[Justbrowsing2024]

Means myself and lots of people I know will need to pay 40% tax. The new thresholds being lowered means we will be worse off at a time when everything is going up. I know it's only on a proportion of salary but it's a proportion that was going towards the increase in mortgage (due to come off an amazing low rate), imminent increase in childcare fees, council tax and everything else.
I know it's affecting so many people but today I have felt really flat.

I'm not anywhere near the top of the threshold (£45500 salary) and unlikely to get a payrise.
I'm sure tomorrow will feel brighter but feel free to join my pity party

Interesting this has been posted today and maybe I fall into the ‘thick’ bracket but I never realised that if your tax code is reduced (mine is £7200 ish to account for medical insurance) that it also reduces the next bracket, so I still get £33770 at 20% but means I hit 40% at £45k ish instead of £50k.

Genuinely didn’t know this, and didn’t expect to hit the 40% bracket but have done this month.

But bizarre that so many people seem to lack basic comprehension. It really is a worry.

This stuff really should be taught in schools.

I think you’ve misunderstood. Your tax code is reduced because of medical insurance, but you still get your full personal allowance (assuming you’re paid less than £100k). Some of the £12,500 is just used up by the medical insurance. It doesn’t change your other thresholds though.

The medical insurance is just another way of getting paid and you’re taxed like you got the cash equivalent to the medical insurance.

I disagree. At first glance, it very much does look like the higher bracket tax rate has dropped.

It doesn't take much to make it clear for the majority of UK tax payers who WILL have the standard UK allowance. It doesn't take much to add an extra couple of links with adjusted information for if you have married persons tax allowance or earn over £100k.

This is what I saw. If I have misunderstood I will be over the moon.

No need to be a dick is there. If I have misunderstood then that's great

You have misunderstood. Nothing has changed

Don’t you think there might have been something in the news if all the tax threshold moved £12k

But what did you see and where?

Which was my understanding but that hasn’t happened and the explanation from payroll is the above. Interested to know if that is incorrect.

I haven't received a letter. I looked at the website after being told and it wasn't clear to me

Who told you?

@Cookiesandcandies Ive tried to add the image of the explanation but it’s pending review. Hopefully you can see it when it posts.

So much faux naïveté. Absolute bot bull 💩

That's what I read. Never have I been so glad to be wrong!

I’m confused - this still says you get £37,700 at 20%?

No mention though of the shit show of losing tax free allowance over 100k. You could easily think you only pay 40% tax when your marginal rate is 60 %

The PP is wrong.

You have a £7.5K or so personal allowance (or close enough)
The next £37k or so is taxed at 20%
Everything about the £7.5k plus £37k is taxed at 40% until you get to £100k where it gets really complicated.

@Cookiesandcandies if your tax code is 784L then your personal allowance is £7,840 and not £12,570 for the purpose of calculating tax rate bands. Otherwise what’s the point?

The wording on that screenshot you posted is very bad.

It should emphasise that e.g. tax @20% is on the first 37k AFTER your TFA has been deducted, or something along those civil service speak lines.

Yes and £12.5k at 0%

£12.5k plus £37.7k is where 40% kicks in.

@LittleBearPad 100% 👌🏾

62% incl NI.

Yes but only £7k tax free, I’ve earnt £45k but paid 40% tax on the last £1.5kish so it’s kicked in £5k before £50k

Work colleagues, quite a few to be honest so they all thought the same. I will be happy to report back