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Topic: How much taxes on payroll?  (Read 1353 times)

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How much taxes on payroll?
« on: February 25, 2016, 09:59:44 PM »
So as we debate to move or not one of our big questions is how much money can we make. We are fully aware that salaries are lower in the UK but how much of what we make will go to taxes? I guess an easy was to ask is... whats the tax rate? Being optimistic and hoping I can find a job in publishing making around 30-35K.

Thanks.
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Re: How much taxes on payroll?
« Reply #1 on: February 25, 2016, 10:29:21 PM »
From the government website https://www.gov.uk/income-tax-rates/current-rates-and-allowances

Example
You have £35,000 of taxable income and you get the standard Personal Allowance of £10,600. You pay basic rate tax at 20% on £24,400 (£35,000 minus £10,600).
So you would pay just under £407 per month in Income tax.  It would be deducted at source and you would see the deduction on your payslip.

Depending on who earns what you can transfer some of the allowance.

There is also National Insurance https://www.gov.uk/national-insurance

Assuming you would be using the NHS then there would be no need for medical insurance and I think you would find filling in an online UK tax return a joy compared to the US one.   Not that many people  need to file tax returns - I think I filled in 3 over 25 years.


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Re: How much taxes on payroll?
« Reply #2 on: February 26, 2016, 09:28:42 AM »
Salarycalculator.co.uk is very accurate.

Personally I would recommend still holding private insurance (most companies offer it).  The few things my family has needed (allergist, dermatologist, dentist) are not covered on the NHS (well, some dental is but it's very bare bones). 

£30k would be take home of £1,950.  £35k would be take home of £2,240.  Most people are paid monthly here.


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Re: How much taxes on payroll?
« Reply #3 on: February 27, 2016, 06:24:38 PM »
Thanks all this is a huge help.

Cdtaylor... you said you have only filed 3 tax returns in 25 years. Is this normal practice? Do you mean you have only files 3 US tax returns in that time.

We are aware that US citizens living in UK have to file US tax returns if they earn over a specific amount but we are not sure how much that amount is. Anyone know what that amount is?
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Re: How much taxes on payroll?
« Reply #4 on: February 27, 2016, 07:26:35 PM »
He means UK self-assessment tax returns.  For the most part the taxes are done via payroll though often someone with US assets will need to complete a UK self-assessment.  Depends how simple your financial circumstances are.

Yes, you'll need to continue filing a US tax return.  The threshold is low for Married Filing as Single and changes annually ($6k ish).


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Re: How much taxes on payroll?
« Reply #5 on: February 27, 2016, 10:16:10 PM »
So.....wait a minute!! As I understand what you are saying is that if one makes over 6000 US I will then have to pay taxes on what I earn to the US??? And obviously to the UK.
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Re: How much taxes on payroll?
« Reply #6 on: February 27, 2016, 11:38:35 PM »
So.....wait a minute!! As I understand what you are saying is that if one makes over 6000 US I will then have to pay taxes on what I earn to the US??? And obviously to the UK.

That's the threshold to have to file a US tax return, not to pay taxes


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Re: How much taxes on payroll?
« Reply #7 on: February 28, 2016, 02:14:32 AM »
So.....wait a minute!! As I understand what you are saying is that if one makes over 6000 US I will then have to pay taxes on what I earn to the US??? And obviously to the UK.

A US citizen should file a 1040 each year to see where they stand for taxes. When you file your 1040 from the UK you'll be able to exclude up to $100k of foreign earnings from US taxation. You can also get credit on your US taxes for UK taxes that you pay. So you will avoid double taxation.


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Re: How much taxes on payroll?
« Reply #8 on: February 28, 2016, 06:04:10 PM »
Nun - that would be a nice problem to have....ie ..making over 100k in foreign earnings. Thanks for clearing that up.
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Married: 2001 (Both Living in the US)
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