About The Salary Calculator

New – Maternity and Paternity pay calculations

by Admin

You may remember that a short while ago, I added a calculator for sick pay and unpaid leave. It was natural for me to consider the effects of maternity / paternity pay, too, as this can have a similar effect on your take-home pay – and Statutory Maternity Pay and Statutory Sick Pay are calculated in quite similar ways. I have now added this option to the maternity pay salary calculator.

You will notice that this is the same calculator – the Sick Pay Calculator has been expanded to include statutory parental pay as an option. If you will be taking some maternity or paternity leave, you can estimate the effect on your payslip by entering the details of your salary, days per week that you work, and how many days in the pay period you will be taking as leave. If your employer offers some of your leave at full pay then you don’t need to enter these days. If you are receiving some leave at 90% pay (you are normally entitled to this for the first 6 weeks of maternity leave) then use the % pay fields to handle those days. And for any days in the pay period that you will be receiving Statutory Maternity (or Paternity) Pay, currently £151.20 per week, use the Statutory Parental Leave field.

Important note! All calculations provided are estimates and indicative only. Different employers have different leave policies (for sick pay and for parental pay), they also calculate leave in different ways. You may not be entitled to statutory pay. The calculator does not know what you are entitled to, only what you have entered. If you are paid monthly, or have an irregular work schedule, Statutory Pay can fluctuate from pay period to pay period, which the calculator does not allow for. More information about maternity pay is available from Gov.UK.

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None of the content on this website, including blog posts, comments, or responses to user comments, is offered as financial advice. Figures used are for illustrative purposes only.

New tool for those thinking of retiring

by Admin

If you are thinking of retiring soon, you might be wondering what kind of effect taking your pension would have on your take-home pay. This is not quite as simple as it might sound at first – the deductions from your pension income will not be the same as those on your salary. For example, you might be paying into a pension with some of your salary, which of course you would not do with income from a pension. And National Insurance is not deducted from pension income, whereas it is deducted from your salary if you are below state pension age.

With this in mind, I have combined a few options from the Two Jobs calculator (which shows you the take-home pay if you have two income at once) and put them in the Two Salaries Comparison Calculator (which compares two incomes side-by-side). Now, you can enter different options for the two different incomes you are comparing (e.g. different bonuses or overtime) – and you can also tick a box on the “Additional Options” tab to indicate that one or other of the incomes is a pension. This income will then not have National Insurance deducted from it – so you can enter the details of your employment for the first income and the details of your pension in the second income, tick the box to say the second job is actually a pension, and the calculator will deduct NI only from the first income.

If you are thinking of retiring, or just investigating a new job which would have a different salary and different deductions, try out the Two Salaries Comparison Calculator.

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Receiving a pension AND employment income

by Admin

The Salary Calculator has had the Two Jobs calculator for a little over a year now. I have had a couple of people contact me and say that they haven’t been able to use it for their situation, which is that they are receiving one income as a pension but they have a second income from a job. The pension doesn’t have National Insurance deducted from it but the job does, and it wasn’t possible to reflect this in the calculator. However, this oversight has now been fixed!

On the Two Jobs calculator, the Additional Options tab now has two extra tick-boxes which you can use to indicate that either the first or second job is a pension (or indeed that they are both pensions). The calculator will then not deduct NI from the job that you say is actually a pension. On all other calculators, where you are only dealing with one income, you can just tick the “I do not pay National Insurance” box if this actually a pension.

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New pension options

by Admin

A while ago, I considered adding an option to the calculator allowing you to enter the amount in £ that you contribute each month, rather than the percentage. I thought this would be useful for people whose employers didn’t use their salary as the basis for the pension contributions but instead “pensionable pay” or something similar. I never got round to it because I thought it was too much of a niche and would make the calculator too confusing. However, the current Coronavirus situation with people being put on furlough made me realise that more people would be affected by this than usual, so I have added this option.

I had an email from a visitor to the site who said that his pension contributions in furlough were based on his full salary, not his reduced, furlough pay. As such, the percentage he was entering was giving the wrong deduction when applied to the reduced pay. To combat this, I have now added the option to switch from a percentage input to a £ input. Enter the amount you contribute, choose the pay period, select what kind of pension you have, and then the calculator will use this amount as your pension contribution. To make this even easier, on the Furlough Calculator you can enter the percentage as usual but tick the “Don’t reduce pension” option, in which case the calculator will automatically apply the pension contributions from your full salary to your reduced salary.

People who contribute to a personal pension (i.e., not through their employer) might also find it easier to use the £ amount option, as it may be easier than calculating the percentage.

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Wednesday, May 20th, 2020 About The Salary Calculator, Pensions No Comments

Update to Salary Sacrifice options

by Admin

The Salary Calculator has had an option for “Salary Sacrifice” (where you give up some of your pay in return for some benefit like a cycle to work scheme) for some time. I have just made a small update to this tab because there are in fact two kinds of salary sacrifice – for most schemes, the sacrificed salary only reduces your National Insurance contributions, but a few schemes are tax-exempt and therefore also reduce the amount of income tax you pay. Now, you will see that there are two options on the Salary Sacrifice tab – one for NI only sacrifice and one for tax-exempt sacrifice.

If you take part in one of these schemes, enter the amount you sacrifice and whether that is monthly, weekly or yearly into the option that applies to your scheme. If you are not sure, check the details of your scheme or ask your employer (or compare the results of the calculations with your payslip). If you are a member of multiple schemes you can put the total sacrifice in the relevant option, and if you are a member of some NI only schemes and some tax-exempt ones you can put the relevant values in each option.

n.b. For salary sacrifice pensions and childcare vouchers you should continue to use the dedicated Pension and Childcare Voucher tabs, because the calculations are slightly different.

If you’d like to try it out, head on over to The Salary Calculator!

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Friday, May 15th, 2020 About The Salary Calculator No Comments

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