This is a tool that calculates the UK income tax and net income for the earned income segment of the total gross income over a specified tax year, and displays the results in a table.
Additionally, if required, the tool displays more detailed results from the tax calculation: the tax allowances used, the tax band details (showing the range, taxable income, tax percentage rate and calculated tax for each band), and, if relevant, any tax rebate applied.
Note: Since age related tax allowances are dependent on the total income and this tool only considers the earned income segment, the allowances used for these calculations may differ from the allowances which would be applied if other income sources were taken into consideration. If you wish all income to be used in the tax calculations, please use the UK Income Tax (Total) tool instead.
For the earned income calculations, it is necessary to supply the following compulsory information:
- Your gross earned income in monthly, weekly or annual terms.
- The tax year, noting that this runs from 6 April in the first year to 5 April in the next.
- Your date of birth, in the default format (DD/MM/YYYY), unless you change the format in the menu. To reduce the time needed for data entry, a default date of birth is provided that can be used by most tax payers for calculating tax. Only if you are 65 or over during the tax year, and age related allowances come into consideration, is it essential to provide an accurate birth date.
If you qualify for any of the extra income tax allowances, i.e. additional to the personal allowance, then supply the relevant parts of the following information:
- If you qualify for the blind person's allowance, choose Yes in the drop down box.
- If you are entitled to the married couple's allowance, choose one of the options starting with Yes in the drop down box. If you were married, or became a civil partner, before the start of the tax year, then select Yes - Full to indicate that you are entitled to the full allowance. If you were married, or became a civil partner, during the tax year, you need to work out how many tax months of allowance you are entitled to, and select the appropriate option. To determine the entitlement, begin with the full 12 months and deduct a month for each complete tax month before the date of your marriage or civil partnership.
- The date of birth of your spouse, if your spouse is older, since this may affect your married couple's allowance.
- If you are entitled to the married couple's allowance and wish to apply the tax rebate associated with this allowance to your earned income tax, choose Yes in the drop down box.
- Note: The calculator assumes that only one member of an entitled couple gets the married couple's allowance. It does not allow for the specification of the transfer of part of the allowance to the other spouse or partner.
Note: The net income calculated by the tool does not take into account the deduction of any national insurance contributions.
The data (e.g. rates and allowances) used by this tool was obtained primarily from...
Associated tool link: http://www.coggit.com/tools/uk_income_tax_earned.html