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  • RE: annual bonus tax implications

    Not been answered here - as far as I can tell. What to do when the "tax rebate" never materialises? My understanding is if you get a bonus, and in that bonus month you get taxed more, then the next month when the salary goes back to normal, not only does one pay less tax than the tax paid during the bonus month, but less tax is paid as a rebate. Is this correct? Because I have yet to see any such rebate. The tax doubles (for a bonus of just £1k, £2k) from its usual monthly figure for the bonus month, and the following month it goes back to what it usually was - no rebate, no nothing. If that is how it is supposed to be, so be it. I just need clarification on the language above where an HMRC admin wrote "When you are paid in July and back to your normal monthy wage you will not be charged higher rate tax and will get a tax rebate in your pay by way of paying less tax that month".