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Posted Mon, 22 Jan 2024 13:48:56 GMT by
Hi, I wanted to ask for advice on whether rather large self assessment payments asked at every tax year are normal in my case or whether there is an issue somewhere. I really am not very literate in tax matters! My situation is pretty simple: my only source of income is my employment in a company except minimal (50 pound a year) bank account interest accrued. My company manages tax paid through PAYE, bonus is paid through regular payroll. Pension is taken from salary through the company pension scheme (no other pension fund anywhere). No other source of income and same company for years. For 21/22, final tax code was 1257L, income was 111594, tax deducted through payroll 32066 -> but at self-assessment time additional tax owed was 2300 according to the calculation. [Breakdown of NI brackets was 6240/3324/40704/6105]. For 22/23, final tax code was 1257L, income was 123059, tax deducted through payroll 36652 -> but at self-assessment time additional tax owed was 4264 according to the calculation. [Breakdown of NI brackets was 6396/5505/38367/6667]. Are the magnitude of these adjustments normal? Do you know what drives them? I'm happy to pay tax as it serves a good purpose - but some friends told me these could be pretty high adjustments so wanted to ask some guidance! Thanks, JustAnotherTaxPayer
Posted Thu, 25 Jan 2024 11:31:18 GMT by HMRC Admin 20 Response
Hi justanothertaxpayer,
Due to your level of income you are not due full personal allowances -  Income Tax rates and Personal Allowances Income over £100,000.
As you state your tax code was 1257L, you have had the benefit of full allowances in error.
Thank you.

 

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