Help calculating taxable income!

[Personalallow]

Can anyone help?

If I earn about 118k pre-tax
Pension contributions 12.5%
What is my taxable income, approximately?

I’ve been working it out at 103.5k
But I think I’m forgetting that I don’t lose the personal allowance fully at this level?

Will the personal allowance be 12570 - (3500/2) ‎ = 10,820, where 3500 is the amount earned above 100k after pension deductions?

Making taxable income just less than 93k?

Help gratefully appreciated! I feel really daft as I’m usually quite good at this stuff

Use this; www.thesalarycalculator.co.uk/salary.php

Your calculation is correct, but don’t forget that any benefits such as private health cover will also have a value that needs to be added to the £118k and then reduce your personal allowance further 👍

Thank you. I have used this before, but I think I’m putting in the pension part incorrectly. I’ve been keeping it on the “auto-enrollment” option, which seems wrong. Numbers are closer to my calculations with the “salary sacrifice” box.

What it for? If you do a tax return it will calculate it for you?

assuming that your pension contributions are your own solely, rather than employer+salary sacrifice then I think you’re fine with your calc but as others have said, watch out for benefit in kind.

This.

Surely filling in your tax return online would be the simplest way of determining your tax liability?

I suppose the issue is that by the time you do a tax return, it's too late to solve the issue the OP is concerned about, ie the disproportionately high tax rate for people who earn just over £100k.

I suppose it depends on whether you need all your income or can afford to put a generous amount into a pension to make sure you comfortably reduce your income below £100k.

But assuming your income is relatively stable, it's probably a one off problem as next year you'll have a better idea of the numbers so will know how much you need to put into a pension to reduce your taxable income to just under £100k.

I agree it is likely to be a one-off problem.

However, it's only 3.5 months to the end of the current tax year. OP can use the calculator mentioned upthread to get an idea and put aside what she might potentially owe. If she is earning in excess of 100k she ought to have savings to cover any shortfall.

And/or consult with a tax accountant if she absolutely needs to know now.

Thanks all!

Maybe I’m not as good as this as I thought! I’ve never filled in a tax return. No work benefits (NHS)!

The question is related to childcare. I don’t want to mess up my calculations and find I’m over 100k taxable income.

Just seen your update in your post. Ignore everything relating to personal allowance. You need just to get the first bit below the 100k. So increase your pension contributions by ~4K or put money into SIPP before the end of the tax year

This is CRITICAL context. Your original calculations are right, you should be ignoring the personal allowance.

Your taxable income includes the bit that falls in the personal allowance, just that bit is taxed at 0%.

You need to look at your gross salary less employee pension contributions and keep this number below £100k.

Also if it is for the 30 free hours in term time for 9 month babies + which higher earners don't get, remember your husband's income also counts too so if either of you is over the amount you don't get the hours. However everyone with a child even if on £100m a year and even if an asylum seeker gets the 15 free hours in term time from age 3 of the child.

Thank you.

Sorry, I should have put the context in my original post but having read threads on here in search of the answer I’ve seen posters get attacked for asking how to keep their income down for childcare reasons!

Husband is on far less than me so that’s not an issue. But we have three children under four so will need to find an extra 21k in taxed income if I accidentally make 101k.

I plan on speaking to an accountant but just wanted to get some idea of where we are at before I do that.