Barclays has defended its lucrative executive bonuses as a necessary part of running a global investment bank. The bank’s chief executive, Antony Jenkins, is preparing to explain to critics the importance of large bonus payments to the company’s rising number of executives paid in excess of £1 million a year. The institution’s latest annual report…
Whether you are an employer calculating income tax and national insurance contributions for employees or perhaps a self-employed individual making those calculations, it can be a time consuming and laborious task if you need to do it manually. With a PAYE Tax Calculator you can quickly and easily do these calculations if you have some basic information at hand.
What Is a PAYE Tax Calculator?
A PAYE Tax Calculator is actually a software programme that is quite easy to use because you only need to answer pre-defined questions. The purpose is to calculate how much income tax and NIC should be deducted from payroll. Some may be fill-in-the-blank type questions whilst others may require a simple yes or no. There may be some questions on certain PAYE Tax Calculators which you can answer from a drop down menu. You will find that there are variations in the questions asked amongst different software programs, but essential information will remain the same. You can find a PAYE Tax Calculator free online or you could use the one on the HMRC website.
Basic Information Required
Before sitting down at your computer to use the calculator you will need to know the tax code and of course the gross wages. If you are using a PAYE Tax Calculator for your own taxes you can find your tax code either on your P45 which you receive from your employer or on your PAYE Coding Notice you receive from HMRC. You normally receive this just before the beginning of each tax year but you may receive a new one if your circumstances change requiring a new tax code.
Using a PAYE Tax Calculator
Once you have that information in front of you it is time to begin. Read the questions carefully on the screen and answer them as accurately as possible. As mentioned you may be asked for your tax code. You will most likely be asked for the time period you are being paid for, such as weekly, two weekly or monthly. You may be asked questions such as if this on a week 1 or month 1 basis and then you will be asked your gross pay for the time period. Some calculators ask for previous total gross pay to date as well as requiring tax due to date amongst other questions. Be as complete and accurate as possible, especially if you are calculating your own taxes, because you will be held liable if you don’t pay the required amount of income tax and national insurance contributions.
Since you can find a PAYE Tax Calculator online for free, calculating your taxes can take mere moments. As long as you have the required information at hand the software does all the computations for you. It is a simple matter of entering information asked for on the screen and then flipping to the next screen as some calculators have more than one page of questions. Using a PAYE Tax Calculator doesn’t make paying taxes any easier but it sure does make it easy to figure out how much you owe.