The Salary Calculator

Updated for April 2021

by Admin

The Salary Calculator has been updated with the tax rates which take effect from 6th April 2021. Some of these rates are still subject to confirmation by the relevant governments, but the calculator will be updated if any of them change.

The biggest change is the introduction of “Plan 4” student loan repayments, for Scottish students. If your undergraduate loan is administered in Scotland and due for repayment you will start repaying under Plan 4 from April 2021, even if you have been previously repaying under Plan 1. Those already repaying their loans will switch from Plan 1 to Plan 4 repayments in April. This change does not affect students in England, Wales or Northern Ireland, and nor does it affect repayment of postgraduate loans.

If you would like to see the effects of this change, and any others from April 2021, try out The 2021 Salary Calculator by choosing the “2021/22” tax year from the drop-down box.

Tags: April 2021, budget, income tax, national insurance, Pay As You Earn, student loan company, student loans, tax rates, The Salary Calculator

New option – reduced pay

by Admin

With the coronavirus outbreak affecting businesses around the country, a number of employers have had to make the decision to ask staff not to come in to work. The government announced last week that, to encourage employers not to lay staff off, they will pay up to 80% (to a maximum £2,500 per month) of staff members’ salaries if they keep them on the payroll. As well as trying to ensure that employees still receive some pay, the plan is to keep the workers available so the economy is well placed to start up again once the virus threat is reduced.

I have added an option to the existing Pro-Rata Calculator which allows you to enter a percentage of salary instead of reduced hours. Some employers will continue to pay their employees the full amount during the pandemic, others may only be able to pay what they are receiving from the government. And of course, for other reasons you might be receiving a percentage reduction in salary. If this applies to you, enter your full-time salary and full-time hours, then enter the percentage of your salary that you will be receiving. With tax and pension deductions etc taken into account, you might find that the reduction is not quite as bad as you thought. For example, someone on the UK median full-time salary (which is about £30,000) normally takes home £1,915 per month after tax and 5% auto-enrolment pension contributions. On 80% salary, they would take home £1,595, which is a significant drop but still just over 83% of normal. Other deductions like Student Loan repayment could make the overall reduction to a slightly more manageable 85%.

Also of interest might be the new Sick Pay Calculator, which I launched last week to help people who have had to take a short period of time off on reduced pay.

Tags: coronavirus, covid-19, Economy, furlough, HMRC, income tax, layoff, national insurance, Pay As You Earn, pension, pro-rata, reduced pay, student loans, The Salary Calculator, unemployment

New tool – Sick Pay Calculator

by Admin

With many people having to take time off work due to the current situation with COVID-19, I thought I would try to create a sick pay calculator. If you will be taking time off, and your employer’s policy states that you will receive reduced (or no) pay for your time off, the Sick Pay Calculator will try to estimate the effect on your take-home pay.

You can enter the number of days on a percentage of your normal pay (e.g. 50% for half pay), the number of days on Statutory Sick Pay (n.b. the calculator is not able to tell whether or not you are eligible for SSP, learn more from Citizens Advice), and the number of unpaid days. The calculator will use this information to estimate how your payslip will change.

Please note that different employers calculate things like unpaid leave in different ways, so the calculator’s results may differ from those on your payslip. Also, how much you will get paid for time off depends primarily on what your employer’s relevant policies state – you will need to know what you are entitled to before using the calculator.

Please let me know if you have any trouble using the calculator – I’ve tried to reduce the number of unexpected results, but it is possible with a lot of time off and with many options such as pensions and student loans applied that the answers given might be a bit unusual!

Tags: coronavirus, covid-19, HMRC, income tax, Jobs, national insurance, Pay As You Earn, Pensions, sick pay, student loans, The Salary Calculator, unpaid leave

April 2020 calculations

by Admin

The Salary Calculator has been updated with the tax rates which currently stand to take effect from 6th April 2020. I say “currently”, because there is a Budget taking place on Wednesday 11th March and it is possible that some changes to tax rates or allowances will be announced. If this is the case, the calculator will be updated with the latest values as soon as possible following the Budget.

At the moment, no changes to the tax-free personal allowance or income tax rates have been announced (apart from in Scotland, where some tax thresholds have been increased slightly). However, the threshold for when you start paying National Insurance has increased, meaning that National Insurance contributions will be reduced by up to £104 per year.

Those repaying their undergraduate student loans will also find that the repayment threshold has increased – for Plan 1 it will be £19,390, and Plan 2 £26,575 per year. Although this increase will reduce the payments you make in each payslip, it will of course mean that it takes longer to repay your loan.

If you’d like to see how the changes will affect you, head over to The Salary Calculator and remember to choose 2020/21 from the Tax Year drop-down box.

Tags: April 2020, budget, income tax, national insurance, Pay As You Earn, personal allowance, student loans, tax rates, The Salary Calculator

New! Two Jobs Salary Calculator

by Admin

I have finally been able to deliver something that has been on my “to-do” list for several years – a salary calculator for when you have two jobs at the same time. If you are considering taking on a second job to help make ends meet, or if you have two part-time jobs rather than one full-time job, it isn’t easy to work out what your take-home pay will be. If you’d like to try it out and see what a difference an extra job could make, head over to the Two Jobs Salary Calculator.

All the usual options are there, such as pension contributions, bonuses and overtime, to help you see all the details in one place. You can use the calculator without a tax code, or with a single tax code for both jobs, or with individual tax codes for each job if you have been given them by HMRC.

It can be quite complicated to work out the tax and other deductions for those who are working two jobs, so I hope this will be useful to some of you. It was also quite difficult to find a way to display all the options (like pension contributions from both jobs) without making it too hard to use. I hope I have succeeded, I look forward to hearing from people who have used it.

Tags: careers, HMRC, income tax, Jobs, national insurance, Pay As You Earn, pension, Pensions, second job, student loans, tax rates, The Salary Calculator, two jobs