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difference between gross pay and taxable pay?

Discussion in 'Pay and conditions' started by sparklyrainbowfish, Mar 24, 2007.

  1. Hiya - I wonder if anyone can help me work this one out.
    I have a discrepancy between the amount of gross pay I earnt this tax year and the taxable pay showing on my payslip. It doesn't show an accrued gross total, but I've worked out what the difference is. I thought that the difference would be due to pension, as pension is non-taxable (is that correct?) But the figures are about £40 different. Could that be because more pension was taken since January and the system is still programmed in for 6% to be non taxable?
    I need to notify the tax credits people what my salary was - what figure do I give? the taxable amount shown on my payslip or my actual gross amount?
    Please help!
     
  2. Hiya - I wonder if anyone can help me work this one out.
    I have a discrepancy between the amount of gross pay I earnt this tax year and the taxable pay showing on my payslip. It doesn't show an accrued gross total, but I've worked out what the difference is. I thought that the difference would be due to pension, as pension is non-taxable (is that correct?) But the figures are about £40 different. Could that be because more pension was taken since January and the system is still programmed in for 6% to be non taxable?
    I need to notify the tax credits people what my salary was - what figure do I give? the taxable amount shown on my payslip or my actual gross amount?
    Please help!
     
  3. tafkam

    tafkam Occasional commenter

    Have you taken into account an increased tax allowance to offset the GTCE costs?
     
  4. Thanks Tafkam, didn't think of that.
    Would that show in my tax code? If it should, it hasn't. Or does it just get recognised as non-taxable pay?
    That would make sense - but I don't pay my GTC subs from my salary, I pay by direct debit. Does it make any difference?

    Do you know which amount I would have to declare to the tax credits people (gross or taxable salary)? I presume it would be gross, but I've only just realised that my payslips only show taxable salary to date, not gross to date. And neither did my P60 last year (oops).

     
  5. tafkam

    tafkam Occasional commenter

    If you have claimed back the tax on the GTCE fee (paid by DD) then it should show in your tax code (probably being 506L instead of 503L)

    I'd also expect you'd have to declare either gross income, or possibly take-home pay, not taxable income.
     
  6. I thought that about the gross income - but neither my payslips nor my p60 shows the gross amount. Odd. In the "to date" section, it only shows taxable pay, tax, NI and pension.

    And my tax code doesnt have the extra £30 included for GTC fees.

    That's why i was confused.
     
  7. tafkam

    tafkam Occasional commenter

    Hmmm... the plot thickens.
    I think you'd need to go through every pay slip since April to see quite what had gone on with your money... your guess is as good as mine!
     
  8. Ok!

    I do know that I've been paid the correct amounts because I always check. At least that's something.

    Thanks anyway!
     
  9. erm

    erm

    From the HMRC website...

    "Broadly, you will have to report in the tax credits claim form income which is taken into account for income tax purposes."

    This is not the same as your 'gross pay', 'take home pay' or 'pensionable pay' and is given on your P60 as your 'pay for tax purposes'.

    For more info on what else you have to declare, see http://www.hmrc.gov.uk/leaflets/wtc2.htm#d1
    At the bottom of this page are worked examples which I found particularly useful when trying to get my head around it all, and trying to work out what effect me working or dh's rise in salary would have. (If you're interested, for every extra pound dh or I earn, we only end up about 30p better off because of the reduction in tax credits as a result.)

    As for the discrepancy, no idea. As you assumed, the discrepancy on dh's P60 is exactly the figure of his pension paid.
     
  10. thanks.
    useful link. :)
     
  11. jubilee

    jubilee Star commenter

    Your tax code will not show the extra £33 paid to you. That will be part of your gross pay and taxable pay.
    The tax code will show the tax relief that you get for GTC and Union subs that you pay (if you have informed the Inland revenue about them).

    Your P60 will show Gross pay and taxable pay. Any tax return will require only your taxable pay total for assessing any rebate or extra tax to be paid.
     
  12. Hi jubilee.

    Thanks for your advice, but there are some differences in my documents to those that you outlined.

    My P60 from last year definitely did not show my gross pay - and my payslips definitely do not show a cumulative amount of gross pay.

    My tax code does reflect my Union subscriptions, but not my GTC fees.

    At least I only need to report the taxabe pay - that makes life easier!

    Thanks
     

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