The Salary Calculator

New pay periods available

by Admin

For some time now, people have been asking me to add different pay periods to the results table on The Salary Calculator – not everyone is paid weekly or monthly, so the information displayed was not as helpful as it could be. Well, today, The Salary Calculator has been updated so that you can choose the pay periods which are displayed in the results table. New options available are two-weekly or four-weekly pay.

The old standards of Yearly, Monthly, Weekly and Daily are still available and will be displayed by default. However, if you get paid on a two-weekly basis you can now tick the “2-weekly” checkbox at the bottom of the options to have that displayed in the results table. Alternatively, if you get paid every four weeks (as opposed to monthly), you can tick that option instead.

This is long overdue, I’m sorry to everyone who waited so long to have it available – thank you for your patience! I hope you find this useful – please let me know in the comments if you have any problems with it.

Tags: four-weekly, Pay As You Earn, pay periods, The Salary Calculator, two-weekly

New – “Plan 2” Student Loans

by Admin

The Salary Calculator has been updated to support the latest changes to student loan repayments which will take effect for some tax payers next April. For students who start their courses this autumn, the way that deductions will be calculated when they enter the workplace will be different from the deductions applied to students of previous years.

Students whose courses started before 1st September 2012 (including those of you who have completed your course and have even started repaying) will see no change, and will repay the loan with deductions of 9% of your salary which is over a threshold of £15,795 per year. This is as before, but it is now called “Plan 1”. If your course started after 1st September 2012 and you are resident in England or Wales, you will repay under “Plan 2”. Plan 2 repayments are also made at a rate of 9%, but only on salary over a threshold of £21,000 per year. This means that deductions will be lower, and repayment of the loan will take longer. Of course, most students who started their course this autumn will not be expecting to enter employment for a few years, and deductions are only made from the April after you finish your course. However, if your course is short or this will apply to you when you graduate and you would like to see how it will affect your take home pay, The Salary Calculator will show you if you tick the “Plan 2” box. Check out The Salary Calculator to see what your Student Loan deductions will be.

It is in fact possible to have a loan under Plan 1 and a loan under Plan 2 – for example, if you have studied on more than one course. In this case, the deduction from your salary is still just at 9% (over the Plan 1 threshold of £15,795), but the repayment is split between your two loans. Deductions due to salary between £15,795 and £21,000 go towards repaying the Plan 1 loan. Any deductions from salary over £21,000 go towards repaying your Plan 2 loan.

Plan 2 loans also have a different interest rates charged from Plan 1 loans, which at the moment are higher than Plan 1 interest rates. This, coupled with the lower monthly repayments made under Plan 2, means that students with Plan 2 loans will spend more time (and more money!) repaying their loans. Our sister site Loan Tutor has a student loan repayment tool which will allow you to estimate how long it will take you to repay your student loan given your salary, outstanding loan amount and repayment method (i.e. whether your course started after 1st September 2012 or not).

For more information about student loan repayment, see the Student Loan Repayment website.

Tags: Pay As You Earn, student loans, The Salary Calculator

New – choose your tax year!

by Admin

The Salary Calculator has (finally!) been updated so that you can choose to view calculations for different tax years. You will see that there is now a drop-down box in which you can choose the tax year that should be applied. By default, the current 2012/13 tax year will be selected so if you just want to see current values you do not need to do anything.

Details for previous tax years going back as far as the 2005/6 tax years have been made available, so you can see how your take-home pay has changed over the years. You may have forgotten how the personal tax-free allowance has increased over the past few years, which gives you more to take home – or perhaps you’d just like to see how far your salary would have gone a few years ago.

I do plan to add more past years (i.e. before the 2005/6 tax year) to The Salary Calculator, and of course, when the details of 2013/14 and further forward become available, they will be added to the site. Head over to The Salary Calculator to try it out. Please let me know in the comments below if you find this option useful or not!

Tags: 2005, 2006, 2007, 2008, 2009, April 2010, April 2011, April 2012, income tax, national insurance, Pay As You Earn, personal allowance, tax rates, The Salary Calculator

Childcare voucher petition

by Admin

Since my blog post about childcare vouchers earlier this week, I’ve heard from the people at Busy Bees Benefits, one of the companies that offer childcare voucher schemes to employers, like those I described in my blog post. They told me about a petition they have launched to increase the value of vouchers that could be received by parents tax-free.

As I described in my previous post, the value of vouchers that can be received tax-free is currently £2,915 per year, or £55 per week. This limit has been the same since 2006, but many parents are finding that the cost of childcare has increased in the years since then so the vouchers do not cover as much of their childcare fees. Busy Bees Benefits are trying to get this limit raised to £75 per week (£3,975 per year), and the first step is to get 100,000 signatures on the petition so the proposal can be debated in Parliament. Increasing the tax-free limit would allow parents to sacrifice more of their salary in exchange for vouchers, therefore saving more tax and National Insurance.

More details are available on the Busy Bees Benefits childcare voucher petition page, where you can learn more and sign the petition if you want to back the change!

Tags: childcare vouchers, income tax, national insurance, Pay As You Earn, The Salary Calculator

Childcare Vouchers added!

by Admin

The Salary Calculator has been updated with a new option for Childcare Vouchers. Some employers offer employees the opportunity to have some of their pay in the form of vouchers which can be exchanged with accredited childcare providers instead of cash. These vouchers can be taken tax-free, saving the employee money.

Childcare vouchers are subtracted from your salary before tax and National Insurance, like pension contributions. However, there is a limit to the amount that can be taken tax-free each year – for the current tax year, this amount is £2,915. You can receive childcare vouchers above this amount, but you will not get the tax benefits. If you signed up for the voucher scheme before 6th April 2011, this limit applies no matter how much you earn. However, if you joined the scheme after this date and pay tax above the 20% Basic Rate, the amount you can receive tax-free is reduced. For those paying 40% tax (typically earning £42,475 or more), the tax-free allowance for childcare vouchers is £1,484 – and for those paying 50% tax (earning over £150,000) it is just £1,166.

To see how childcare vouchers can affect your take-home pay, head over to The Salary Calculator and enter your salary, along with the value of vouchers you receive each month. If you joined the scheme before 6th April 2011, tick the box to this effect. Enter the rest of your details and click Go! to see the results.

Tags: April 2011, childcare vouchers, income tax, national insurance, Pay As You Earn, pension, Pensions, The Salary Calculator