After believing I’d always had a better than average grasp on taxation, company car tax and how to calculate it all, I’ve gone and confused myself and could do with some clarity.
Based on the 19/20 tax year with the standard personal allowance being £12,500 and the 40% thresh at £50k...
From April my basic will be £47,750
I will have a company car with a BIK of £9716
I will pay a minimum of £2500 to my pension
My bonus, whilst up to 30% will likely be around £4000
Question - is the car BIK added to my basic, putting me in the 40% bracket?
Let’s say £47,750 - £2,500 pension cont’ = £45,250 + £9,716 car BIK = £54,966 + £4,000 bonus = £58,966
So I would pay 40% on £8,965 (£3,586) plus 20% on £37,500 (£7,500)
If I claimed child benefit for my three children (total of £2500) I’d have to pay back 89/90% of that! (Which is utterly disgraceful if my calcs are correct!)
Am I working it out correctly? Thanks
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