Need help making sense of my first payslip!

Bey0nd

Hi, I just got my first payslip in a new job and I need some help making sense of it.

It's a 6 month contract. I started on the 28th April, and got paid today (28th May). The salary is 28k per annum (pro rata). This is what I thought it would work out at:

Salary = 28,000
Tax Credits = 3,300

Net Salary per month = 28,000 / 12 = 2,333

PRSI of 4% = 2,333 * 4% = 93.33

USC (2% on €10,036) = (10,036 * 2%) / 12 = 16.73
USC (4% on €10,036 to €16,016) = ((16,016 - 10,036) * 4%) / 12 = 19.93
USC (7% above €16,016) = ((28,000 - 16,016) * 7%) / 12 = 69.91
Total USC = 16.73 + 19.93 + 69.91 = 106.57

PAYE: (Standard 20% on below €32,800) = (28,000 * 20%) / 12 = 466.66
PAYE: (Higher 41% on above €32,800) = Not Applicable = 0
PAYE less Tax Credits: 466.66 - (3,300 / 12) = 191.67

Gross Salary Per Month = (Net Salary Per Month - Total PRSI - Total USC - PAYE less Tax Credits)

Thus,

2,333 - 93.33 - 106.57 - 191.67 = 1,941.77 gross pay

But my payslip looks nothing like that. Instead, it looks like this:

Monthly Tax Credit = 275 (this is fine)
Monthly Cut Off = 2733.33 (what's this?)
Basis = Cumul

Total Gross = 2,656.40

PAYE = 841.59 (Why is this so high?)
USC = 185.95 (Again, this is higher than I calculated above?)
PRSIee = 106.26
PRSIer = 285.56 (I'm guessing ee = employee, er = employer, but why is my figure higher than my above calculations?)

Gross Payment = 1,522.60

Any help appreciate please!!!

xalot

No expert but I'd say you are being emergency taxed. Did you provide your new employer with you p45 from previous job? You can call your local tax office and see if they sent out your tax cert to the new employer yet. You'll get the number on revenue.ie

Bey0nd

Thanks for the response! Had forgotten about emergency tax. For some reason I thought that only applied to your first PAYE job. I didn't think it applied to me moving from one PAYE job to another.

If I get my P45 in and everything in line, will I be refunded the emergency tax minus what my normal tax would have been? If so, how does this work, is it one lump sum in my next payslip or is it allocated over the year?

Sorry for the silly questions.

therecklessone

For a start, your net pay is higher than you had anticipated. Is it possible you were paid for some of April, and all of May? The PRSI figure is correct based on the net you received.

Secondly, the monthly cutoff listed is the amount you can earn per month before paying the higher rate.

Thirdly, have you considered ringing your payroll department to query it?

PeterBrown1415

The payslip says 'cumulative'.
I would have thought emergency tax was always week one.

Also your total gross between the two payslips is different.

Meathlass

First things first you need to go to your payroll department as the rest of us here are only guessing. But some general pointers.

Is this your first job in this tax year? If not any money you make is added to your pervious earnings. let's assume it's not.

Monthly cut off - when you go over this figure you're paying the higher rate of tax 41%

Your PAYE looks like it's on emergency tax. That means that your company doesn't have a tax cert for you and doesn't know what rate of tax you should be on. Again talk to payroll or ring revenue directly.

Yes PRSIer is employers - you don't pay that, your employer does.

Bey0nd

PeterBrown1415 wrote: »

The payslip says 'cumulative'.
I would have thought emergency tax was always week one.

Also your total gross between the two payslips is different.

That's why I'm confused. I thought that on a 28k per annum pro rata 6 month contract, my monthly gross would be €2,333 and my monthly net would be €1,941.77. This is the first set of calculations I have included in my original post - my own calculations.

But the second set of calculations is what's actually on my payslip. Does Basis Pay = Cumul mean that I'm not being emergency taxed? If so, why would my PAYE be so high? My partner is on €20k more than me with the same tax credits, and still isn't paying as much PAYE as I am.

therecklessone wrote:

For a start, your net pay is higher than you had anticipated. Is it possible you were paid for some of April, and all of May? The PRSI figure is correct based on the net you received.

Thanks, I understand that the PRSI is correct based on what they are saying my gross is. I just don't understand how they are saying I have a higher gross salary, and I'm ending up with a lower net salary!

therecklessone wrote:

Secondly, the monthly cutoff listed is the amount you can earn per month before paying the higher rate.

Thanks, makes sense.

therecklessone wrote:

Thirdly, have you considered ringing your payroll department to query it?

I will be, I just want to be a bit informed before I call them and see if there's anything I'm overlooking!

Meathlass

Also just a general point but you generally can't divide your gross salary by 12 or 52 if you're paid weekly.

It depends on what system payroll are using but for weekly payments you'd need to divide by 52.18, for fortnightly 26.09 and monthly by 13. This still doesn't get your gross figure OP so I'd query that with payroll too.

This is to take into account leap years/52 weeks etc. Only applies if you're on salary.

Cumulative just means that in your next payslip you'll see the figures from the previous one in those boxes and they'll keep adding up over the 6 months. As of now with your first payslip there's nothing else to put in boxes.

Bey0nd

You're all so much help, I really appreciate this.

@Meathlass - assuming this is emergency tax (which I'm now sure it is) - what do I have to do to get rid of it? Is it just a case of sending my P45 into Payroll? I've heard I can do this quick by ringing Revenue myself, is that right or would I still have to submit my P45 regardless?

I do intend to query this with Payroll anyway, just getting as much info as possible. Thanks again

Meathlass

Do you have your P45 from your last job? If so give it to your employer.

If your last job was last year then your yearly tax statement will do. Give this to your employer.

If you don't have either of these ring Revenue and request a tax statement be sent to your company (it helps if you have the company tax number - payroll will give this to you). You will need your PPS number to speak to Revenue. They will send a copy of tax cert direct to your employer.

You will get the overpaid money back in the form of a tax credit usually so next month you will probably pay very little tax.

sue345

Without seeing your actual payslip & year to date figures it looks like you owed tax and this was clawed back in your pay this month.

Cumulative tax basis means it looks at all earnings & taxes paid year to date, so if you had underpaid slightly due in your previous job the payroll system would automatically deduct whats owed from you wages.

Seen as it was such a high amount this month it is more everything that was owed and your salary / taxes will balance out next month.

Without seeing your actual payslip this is what it looks like to me.

If you want to send on the full breakdown of your payslip including year to date figures (these will include previous salary & taxes paid from your P45) I can provide a better answer.

Bey0nd

Okay so I rang revenue this morning. They said it is correct and it's not emergency tax, but that the problem is withis:

Old job: Worked up until 25th April. Got paid on 9th May.
New job: Started on 28th April. Got paid on 28th May. But because they're in the same month, all my new job's pay is taxed at higher percentage (7% for USC, 41% for PAYE).

I don't understand how that can happen, I've posted my workings here (I also spotted what I think is a mistake in my February pay from my last job...?):

i.imgur.com/ozjt5SR.png (I can't post links, but just copy that into your browser).

Will I never get this money back now? Any advice appreciated

Meathlass

Bey0nd wrote: »

Okay so I rang revenue this morning. They said it is correct and it's not emergency tax, but that the problem is withis:

Old job: Worked up until 25th April. Got paid on 9th May.
New job: Started on 28th April. Got paid on 28th May. But because they're in the same month, all my new job's pay is taxed at higher percentage (7% for USC, 41% for PAYE).

I don't understand how that can happen, I've posted my workings here (I also spotted what I think is a mistake in my February pay from my last job...?):

i.imgur.com/ozjt5SR.png (I can't post links, but just copy that into your browser).

Will I never get this money back now? Any advice appreciated

Hard to answer this as we can't see into the future.

You're allowed earn so much before you have to pay at 41% - this is averaged out over the year. So if when your current 6 month contract ends you are unemployed for Nov/Dec then yes you'll be entitled to a refund. Even if you get another job for those months and it's the same level of salary you're on now you'll get the money back but you'll have to wait until Jan of next year when you can request a P21 Balancing Statement from Revenue to see what/if they owe you.

Your pay for next month should be back to normal though as it's only one salary.

BTW it would have helped if you told us at start that you'd just finished another job

Bey0nd

Meathlass wrote: »

BTW it would have helped if you told us at start that you'd just finished another job

Thanks, but in my second post I said:

Bey0nd wrote:

Thanks for the response! Had forgotten about emergency tax. For some reason I thought that only applied to your first PAYE job. I didn't think it applied to me moving from one PAYE job to another.

sue345

Bey0nd wrote: »

Okay so I rang revenue this morning. They said it is correct and it's not emergency tax, but that the problem is withis:

Old job: Worked up until 25th April. Got paid on 9th May.
New job: Started on 28th April. Got paid on 28th May. But because they're in the same month, all my new job's pay is taxed at higher percentage (7% for USC, 41% for PAYE).

I don't understand how that can happen, I've posted my workings here (I also spotted what I think is a mistake in my February pay from my last job...?):

i.imgur.com/ozjt5SR.png (I can't post links, but just copy that into your browser).

Will I never get this money back now? Any advice appreciated

Thanks for that, Ill take a look when I'm at home later & do a quick calc on it myself...will give you a breakdown of how its all worked out aswell

BTW I work in payroll

Bey0nd

sue345 wrote: »

Thanks for that, Ill take a look when I'm at home later & do a quick calc on it myself...will give you a breakdown of how its all worked out aswell

BTW I work in payroll

You're a star! If you want me to email you the spreadsheet with all those figures, just PM your address and I will. Thanks for the help

namenotavailablE

You might find my Excel spreadsheet useful for this query- it's available for download at the site shown in my signature (visible only when you are logged in) or on the 'About me' tab of my profile.

Also, the moderator has a 'Pay calculations' thread stickied at the top of the list of threads in this forum.