Determining Your Taxode For The 2011/2012 Financial Year
One thing that you need to know about the UK and other tax systems is the fact that
they heavily rely on the tax codes for them to execute the work that they need to execute. With this tax code, you will be able to determine how much money you are able to pay, and you can be pretty sure that, you will be in a much better position to understand what the tax implications will be with changes in the tax code.It is this taxcode that is normally used by your employer in determining what amount of money you should pay to the HMRC. You will find that the taxcodes do not remain constant year-in-year-out, but do indeed change from time to time. It is however not mandatory for the codes to change annually, but it is pretty normal that way.
In this particular article, we are going to look at the taxcodes for the 2011/2012 financial year, and we can then determine where you are in the whole arena. Once you know what your tax codes are, you can then go ahead and determine how much money you will be required to pay to the government as taxes.
To get your tax code, the government usually goes ahead and adds up all the tax-free allowances that are due to you. One of the most common allowance s none other than the 7,745 pounds that is considered as a basic allowance. Other allowances that are added up in coming up with your tax codes are the blind person's allowance, child allowance, and so on.
After this amount, you will have all the income that you have received but for which you have not paid your taxes on. Some of these incomes come from part-time activities that you engage them. Some of these activities include items such as freelance writing and so on.
When the extra income is added up, it is subtracted from the total tax-free allowances that you had accumulated in the first step. The amount that you will end up receiving after these deductions is your net tax-free income.
After getting this income income, the figure is then divided by 10 and then a letter is added to give a clearer indication of the type of tax-code that you re under. From this tax code, you can then determine how much money you will be required to pay to the HMRC.
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