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Help Me Understand How Tax is Calculated watch

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    • Thread Starter
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    If for example my wage is £18,000, does that mean 20% goes towards paying tax?

    Example:

    £18,000 before tax.

    £3600 for tax.

    £14,400 personal allowance.

    Thank you.
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    (Original post by lalalalalalamember)
    If for example my wage is £18,000, does that mean 20% goes towards paying tax?

    Example:

    £18,000 before tax.

    £3600 for tax.

    £14,400 personal allowance.

    Thank you.
    The current personal allowance is £11500 - this is what you can earn before paying tax. If you earn £18000 you pay tax on:

    18000-11500= 6500 at 20% = £1300

    Different rates apply once you reach the higher rate threshold
    • TSR Group Staff
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    TSR Group Staff
    (Original post by lalalalalalamember)
    If for example my wage is £18,000, does that mean 20% goes towards paying tax?

    Example:

    £18,000 before tax.

    £3600 for tax.

    £14,400 personal allowance.

    Thank you.
    You can work out how much tax you'll pay using this calculator: https://listentotaxman.com/
    • Community Assistant
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    Community Assistant
    (Original post by marple)
    The current personal allowance is £11500 - this is what you can earn before paying tax. If you earn £18000 you pay tax on:

    18000-11500= 6500 at 20% = £1300

    Different rates apply once you reach the higher rate threshold
    This is how its worked out.
 
 
 
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