Hello, folks! I’ve got a dry blog topic for you today and days to follow, yet ones that will steer you in the right direction for understanding how you will be taxed once you move to London and start working in the UK.
First of all, when you work in the UK, you are entitled to a national minimum wage of £5.80 per hour if you are age 22 or older. If you are 18-21 years old, you’re entitled to a developmental rate of £4.83 per hour. If you are being paid less than this, you should contact the Pay and Work Rights Hotline at 0800 917 2368 (local UK number).
If you are employed by someone else, your employer will deduct income taxes and National Insurance from your wages and pay them to HM Revenue & Customs (HMRC). If you are self-employed, you will responsible for paying the relevant amounts to HMRC yourself.
Getting Familiar with the Forms:
– When you begin your job in the UK, you should receive a P46 form from your employer, or a ‘P46 Employee without a P45’.
– At the end of the tax year, your employer will issue you a P60 form (or ‘P60 End of Year certificate’), which will detail how much you have paid in income tax and National Insurance for the tax year. If you were already employed by 5 April, you should receive this form no later than 31 May of that same year.
– When you terminate your employment with an employer, you will receive a P45 form in 3 parts (1A, 2, and 3) that detail how much you earned and were taxed thus far in that tax year. When you start new employment with another employer, you will give them parts 2 and 3 of this form.
– If/when you ultimately leave the UK, you must contact HMRC via your Tax Office, which will issue you a P85 form with which you can claim back any tax refund you are entitled to receive. If you’re leaving the UK on completion of a work assignment, you’ll receive a P85(S).
I know, this post is a thrill and a half. Unfortunately, it’s stuff you DO need to know if you’re moving to London with a job, so stay posted for more in this series dedicated to UK taxation!