Tax code

[feellikezerobucks]

Apologies for double posting as I have also put this in the Money Matters topic.

I need some help with tax codes as each time I ring the tax office I get more confused.

My tax code was previously 1257L, however this has been changed to 1395L.
My questions are
1 - is that correct?
2 - is what figure do I used on my tax return for determining my tax code?

The change occurred following my (first) tax return (employee but over the CB thresehold) and I'm not sure if I used the correct figures...again the tax office confused me more when I spoke to them!

I am conscious of any errors as I already owe the last two years of child benefit back and don't want to owe anything else 🤦🏻‍♀️

Earnings for 22/23 and 23/24 below.

22/23
Gross pay £69,043.31
Pensionable pay £65,499.96
Employee pension paid £2,620.02
Assessed pensionable pay £5,458.33

23/34
Gross pay £80,217.93
Pensionable pay £69,187.68
Employee pension paid £2,776.49
Assessed pensionable pay £5,765.64

Any help appreciated! 😬

Did they not send you their calculation of how they worked out your tax code - if you've mislaid it, you can ring and ask for it.

Your tax code is not affected by your earnings or your pension. As the PP says, HMRC should have sent you the calculation with the notice giving your tax code. If you are unclear, tell us what that says.

Hi, if I had to guess from the information given, I think there could be 2 factors at play.

First off, I would have expected a reduction in your tax code to capture this years child benefit. The threshold has gone up this year but not by enough to reduce it to nil. Suggesting that you maybe have ticked the box on the tax return asking HMRC not to include it.

As for your tax code going up, are you on a relief at source pension? This may explain it.

As mentioned previously, it should say on your PAYE coding notice why it differs from standard. When you do get a copy, check if there is any mention of child benefit in the code. If not, you will most likely have to pay some back when you do your tax return.

@feellikezerobucks Since you haven't responded, a couple of pointers.

Your previous tax code, 1257L, means you are getting just the personal allowance. If you have one job, no untaxed income, no unpaid tax or taxable benefits and aren't entitled to any allowances, this is the tax code you will get.

Your new tax code, 1395L, indicates that you have some additional allowance. This may be because you have overpaid tax, or you have a personal pension in addition to your employer's pension, or you have donated money to charity under Gift Aid. There are a number of other things that could entitle you to some additional allowance.

The notice setting out your tax code should explain how it has been calculated. It will show your personal allowance and then show what has been added to it or deducted from it to arrive at the final figure. If you don't understand what that is telling you, post it here and you will get an explanation.