This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.
Analytics

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.

Essential

Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

Tax / RSU question

chelseafan
Posts:3
Joined:Tue Nov 14, 2017 8:48 pm
Tax / RSU question

Postby chelseafan » Sun Mar 31, 2024 6:43 am

Hi
I earn a basic salary of circa £55k gross but receive vested RSU's in November each year taking my annual gross salary to around £220k. The RSU's are taxed by my company.
I've updated my estimated income for 2024-2025 on the government portal to £220k. My question is will HMRC assume my monthly income is £18k(£220k/12) and tax accordingly or will they realise that I get a lump sum payment. I'm really worried that I won't get any wages when the new financial year starts in April.
Thanks

bd6759
Posts:4458
Joined:Sat Feb 01, 2014 3:26 pm

Re: Tax / RSU question

Postby bd6759 » Sun Mar 31, 2024 10:21 am

That’s not how PAYE works. You don’t pay 1/12th of your estimated tax each month.

Tax is worked out based on how much you were paid that month added to how much you were paid in previous months. You get 1/12th of your allowances and rates bands set against your actual pay each pay period, but it is cumulative, so in month 7 you get 7/12ths against your earnings so far.


Return to “Income Tax”