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Why am I paying income tax?

I made £12.30 after working my firs two hours of my first paid job ever. I then find out I have been taxed £2.40, is this some sort of mistake? That is a stupid amount to take away given I have only made peanuts so far, and this has to be below some sort of threshold they have for any deductions to your wages! :frown:
Original post by Anonymous
I made £12.30 after working my firs two hours of my first paid job ever. I then find out I have been taxed £2.40, is this some sort of mistake? That is a stupid amount to take away given I have only made peanuts so far, and this has to be below some sort of threshold they have for any deductions to your wages! :frown:


It's cuz of PAYE (Pay As You Earn). You can apply for a tax rebate/refund from HMRC at the end of the tax year if you earn below your tax free amount (£11k).

I believe I'm owed about £500 as my employer payed that much to HMRC in tax before I left my job.
It should pop up in your payslip as a deduction. NI (National Insurance) should be another deduction on the payslip - you can't get a refund on that because it's basically for your future pension.
Reply 3
Avatar for IWMTom
IWMTom
20
Original post by Anonymous
I made £12.30 after working my firs two hours of my first paid job ever. I then find out I have been taxed £2.40, is this some sort of mistake? That is a stupid amount to take away given I have only made peanuts so far, and this has to be below some sort of threshold they have for any deductions to your wages! :frown:

Your employer set you up wrong in their PAYE scheme so you've been charged emergency tax. This should be refunded automatically in your next payslip.
This is perfectly normal. If by Aoril next year you have earned less than £11k (ish) you will get a nice juice cheque back from Inland revenue.
Reply 5
Avatar for IWMTom
IWMTom
20
Original post by ByEeek
This is perfectly normal. If by Aoril next year you have earned less than £11k (ish) you will get a nice juice cheque back from Inland revenue.

£12,500.
HMRC, not Inland Revenue. This isn't the 90s.
Reply 6
Avatar for Anonymous #1
Anonymous #1
OP
Original post by Jang Gwangnam
It should pop up in your payslip as a deduction. NI (National Insurance) should be another deduction on the payslip - you can't get a refund on that because it's basically for your future pension.

I have not earned near enough to be taxed or have anything deducted from my pay yet though!
Reply 7
Avatar for IWMTom
IWMTom
20
Original post by Anonymous
I have not earned near enough to be taxed or have anything deducted from my pay yet though!

You won't have paid NI.
Original post by Anonymous
I have not earned near enough to be taxed or have anything deducted from my pay yet though!

That's because HMRC automatically assumes everyone on PAYE will be earning over the tax-free threshold. You need to contact them to sort it out.
Reply 9
Avatar for IWMTom
IWMTom
20
Original post by bones-mccoy
That's because HMRC automatically assumes everyone on PAYE will be earning over the tax-free threshold. You need to contact them to sort it out.

Only because the employer didn't set the OP up on their PAYE scheme correctly.
Original post by IWMTom
Only because the employer didn't set the OP up on their PAYE scheme correctly.

A lot of the time it's because the previous employer is incredibly slow at sending out P45's, if you start a new job immediately after leaving another they won't get your P45 before putting you on the system

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