Winseer:
10% NI and 40% Tax on all 2nd and subsequent PAYE jobs…
Nope - not unless the earnings from second (or subsequent) employment takes your total gross pay over the higher tax rate threshold (after deduction of personal allowance).
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When I was working at Manpower as second agency to Staffline Jan-March of last year, I was being taxed @ W1/M1 40% higher rate on the manpower earnings - on ALL of those manpower earnings, fairly high, because of the decent RM hourly rate combined with me doing 40+ hours and all that.
W1/M1 tax codes are almost nothing to do with having a second PAYE employment and pretty much everything to do with having started a new PAYE job without a P45 from a previous employer (although the reason for this could well be because it is a “second job”). Once the dust has settled and HMRC have got the full picture from all your current employments they will allocate a “BR” tax code to oneof your employments (usually the lowest earning one, as this will be regarded as your “secondary” employment). The effect of this code is that you are taxed at Basic Rate (BR…) on the whole of your income from this employment. Your Personal Allowance (and any other Allowances) will be applied to your main employment. If HMRC’s calculations indicate that your total income from all PAYE employments will push you into the Higher Tax rates, they may well tweak the tax code applied to your main employment to make the tax take for the whole year more-or-less correct.
But regardless of all this, my point stands - you do NOT automatically pay tax at 40% on any second or subsequent PAYE employment(s). I’ve been in exactly this situation for the past 10 years…
Isn’t the definition of a “2nd job” where one has taken secondary employment, but has yet to resign/be dismissed from the former first employer?
…Only one single employer can apply the one-use tax free allowance and lower-rate national insurance stamp.
The W1/M1 system assumes that one will earn similar earnings throughout the financial year, so if for example the threshold for higher tax is say, £40,000 then earnings in any W1/M1 period (depending upon being paid weekly or monthly…) will be based around 40,000/52 weeks or 40,000/12 months.
So If I do say, a single RM week with a top line of £900, I’ll get more tax deducted at the time because it looks like I am going to go over the threshold and get taxed on ALL of the £900 (40% higher rate + 10% Nics) because I’ve already used up my tax-free allowance at the firm I’m still listing as “Main employer”…
There’s no point flipping from one to the other straight away, since if one “switched” it would merely reverse the roles…In any case, one can get a rebate IF one’s earnings drop back so that £900+ is seen as NOT the rule…
We’re going round in circles here Winseer. As you appear now to say, the reason you are/were taxed at 40% on your second job is that you were on an “emergency” tax code (ie Week1/Month1), and not because it was/is a second job. Wildly fluctuating pay packets due to the unpredictable nature of agency work exacerbate this.
The gov website clearly states what the “normal” code is for second jobs - BR. And lo and behold that is exactly what I have had these past 10 years.
Franglais:
Agencies are really great aren’t they?
Going to so much trouble, setting up extra companies, employing extra staff, just so their drivers are better off.
The more I read about the setup he being paid by, the more I suspect that it is an old style umbrella which so many people have fallen foul of in the past.
My agency employ me direct and they have their own payroll department. Any issues with payroll I’m able to speak to either my line manager or the payroll department direct to get it sorted, and I don’t get numerous letter from HMRC enquiring about my contributions
Lp do have a pay roll dept ,you ring
Lp tel no , then take the payroll option , all expenses are sent to lp payroll dept , it’s just a txt stating how much your going to
Get paid & pay slip that is by easy solutions
And yes I’m paye & pay tax & ni , which I assume goes to the government
peirre:
Dozy your on Stobarts/Logistics People pseudo pay which is done by a 3rd party payroll company, you are not paid by either Stobarts or Logistics People. That is why your getting lots of letters from HMRC, Stobarts/Logistics People have put you in this position so that your not PAYE on their books, the 3rd party payroll company is technically your employer unless they’ve they’ve somehow managed to set you up in a umbrella style Ltd Co and convinced you that it’s PAYE.
If that was the case you would also be paying employer and employee NiC’s.
They just asked me if I wanted to be paye , I said yes , I definitely pay tax & ni it’s on
My pay slip , the letters from tax office stopped apx a month ago, no idea why , I never contacted them much to my
Mrs annoyance , I just assume it would sort it self out at
End of tax year ( + I couldn’t be bothered )
TBH most of these replies have gone right over my head .
I’ve been finished about 3 weeks from my previous employer , and looking about for some part time work in these trying times .
Mostly agencies advertising for my area , and just wondering what the score is .
Certainly not going Ltd though .
mickymidas:
TBH most of these replies have gone right over my head .
I’ve been finished about 3 weeks from my previous employer , and looking about for some part time work in these trying times .
Mostly agencies advertising for my area , and just wondering what the score is .
Certainly not going Ltd though .
There isn’t any work. It’s the usual carrot dangling story of agencies advertising non-existent work to get all the desperate drivers flocking to sign up on their books. You won’t hear from them for years then all of a sudden your phone will ring with an unknown number and it will be them wanting to know if you’re available because now they’ve got a shift for you.
Wether the picture is nationwide I don’t know, but there’s a lot of regular agency drivers around here sat at home doing nothing, the lucky ones have been furloughed and are getting some money coming in. But I’d guess the majority of them are getting nothing, especially the ltd Co ones. As it highly likely that they are going to announce that they are extending the lockdown for another 3 weeks, then no doubt the furlough will be extending too.
Well after all those letters , saying I owe them xyz my tax code is the same as before
1250 l
But easy solutions have emailed me 2 pay slips !!
Life was so easy when I was a employed driver
Roymondo:
We’re going round in circles here Winseer. As you appear now to say, the reason you are/were taxed at 40% on your second job is that you were on an “emergency” tax code (ie Week1/Month1), and not because it was/is a second job. Wildly fluctuating pay packets due to the unpredictable nature of agency work exacerbate this.
The gov website clearly states what the “normal” code is for second jobs - BR. And lo and behold that is exactly what I have had these past 10 years.
I got a BR tax code when I had underpaid tax recovered during the following tax year.
I questioned at the time why I was being taxed at rate 40% rather than W1/M1 base rate 20%, but ended being advised to change “Main employer status” over from Staffline to Manpower at that time by a tax advisor over the phone, who did it for me then and there.
Following this, I was going to be paying normal taxes on Manpower earnings, and higher rate tax on Staffline earnings.
I stood down from Staffline assignments for 8 weeks, working exclusively for Manpower during this time.
I later got a rebate for the tax I initially overpaid at the 40% rate, since my year-end earnings by March were clearly not going to be anywhere near the higher threshold bracket.
I had sorted it out myself then, but I never understood why I ended up paying 40% in the first place, except guessing as I have on previous posts that maybe it just looked like I was going to go over, and got some kind of “declared earnings” related tax calculated on my behalf, perhaps by an errant agency…
peirre:
Wether the picture is nationwide I don’t know, but there’s a lot of regular agency drivers around here sat at home doing nothing, the lucky ones have been furloughed and are getting some money coming in. But I’d guess the majority of them are getting nothing, especially the ltd Co ones. As it highly likely that they are going to announce that they are extending the lockdown for another 3 weeks, then no doubt the furlough will be extending too.
IF this “Furlough Pay” is supposedly based around 80% of one’s average earnings as PAYE agency for the past year - then who ARE these “lucky ones”?
If you were working flat out and how have zero work - shouldn’t THAT be the definition of “Lucky ones”, probably getting near to this maximum £2500 figure per month mentioned?
If you were flat out for that previous year, and the agency didn’t want to cough up though, - wouldn’t they just try and get rid of you by trickery, claim the 80% from the government, and not then pass it on to the actual employee who’d qualified them to claim that payment even because they’ve already gone by the time the government payout of this 80% money arrives in their bank accounts rather than paid directly to the stood-down staff?
…Let’s see what happens over the next 21 days in particular…