maths question - percentages

[amir_j]

Ok, working abroad and was getting taxes at 20%

Now found out im getting taxed 20% more when back in UK. So spoke to client who will try to compensate me accordingly going forward but needs to know an amount to say yes or no to.

For arguments sake say- Curent daily rate is £100

What should I do to compensate another 20% tax ie 40% in total?? is it as simple as £100*1.2 = £120 as doesnt seem to add up when working back!!

[Stevenj214]

£125

[amir_j]

Stevenj214 said:

£125

Thank you, but ideally need a percentage figure rather than an amount as that ones not teh actual. As in need to say to client in morning I need a x% increase in rate.

essentially need to get to a figure which adds up to the same 80% take home I have now when 40% deducted if you see what I mean.

Edited by amir_j on Monday 15th September 19:37

[Stevenj214]

amir_j said:

Stevenj214 said:

£125

Thanks you, but ideally need a percentage figure rather than an amount as that ones not teh actual. As in need to say to client in morning I need a x% increase in rate.

[Pay Before Tax] = [takehome]/[0.6]

Plug in your takehome and you'll get your required pay before tax (with tax being 40% of all income in this example)

[driverrob]

25% increase.

But call your tax office first. Speak to someone about your situation. You shouldn't be taxed twice and I've found they're surprisingly helpful.

[amir_j]

Thanks guys- double taxation (IR20 section 2) so the uk will work out the difference in tax between here and there- ridiculous seeing as in not using any UK services etc in meantime but thats life.

[samwilliams]

You need a 33.3% increase on your standard rate

[amir_j]

samwilliams said:

You need a 33.3% increase on your standard rate

?? now confused. please an you advise me why as dont wnat to get it wrong.

Edited by amir_j on Monday 15th September 19:56

[samwilliams]

amir_j said:

samwilliams said:

You need a 33.3% increase on your standard rate

?? now confused. please an you advise me why as dont wnat to get it wrong.

At the moment, you get 80% of your rate after tax. It's not entirely clear whether you're saying that you're now going to get taxed at 40% (ie 20 + 20), or that you'll get an additional 20% tax following the initial deduction (eg you get £100, taxed at 20% to £80, and then a further 20% is taken of that £80, giving you £64).

If it's the former, you need 80% of your original rate to equal 60% of your new rate. Multiply both of those by 1.66, and you get 133.3% of your original rate being equal to 100% of your new rate.

If the latter is correct, you need 80% of your original rate to equal 64% (80% x 80%) of your new rate, which requires a 25% increase from your initial rate.

One of those is right!!

[BigAlinEmbra]

amir_j said:

Thanks guys- double taxation (IR20 section 2) so the uk will work out the difference in tax between here and there- ridiculous seeing as in not using any UK services etc in meantime but thats life.

If tax was to pay directly for services used then it would be a charge, not a tax.

I doubt your education was entirely private, so just consider it as paying back for that.

[Eric Mc]

Why are you being taxed in two countries?

[GreenV8S]

amir_j said:

samwilliams said:

You need a 33.3% increase on your standard rate

?? now confused. please an you advise me why as dont wnat to get it wrong.

Don't take this the wrong way, but it seems very clear from your questions that you aren't the right person to answer this question. Unless you understand exactly how to work this out, you're liable to get this badly wrong. I assume if this is a calculation relating to income tax that the figures involved will be significant and it will be important to you that the answer is right. I suggest you pay somebody suitably qualified to give you the answer - don't try to answer it yourself, and don't ask a bunch of random people off the interweb to answer it for you. You shouldn't trust any of us to give you the right answer; we don't even know whether you're asking the right question.

[Glassman]

Eric Mc said:

Why are you being taxed in two countries?

Dual citizenship?

[amir_j]

Eric Mc said:

Why are you being taxed in two countries?

Hi Eric,

Contracting abroad for a short while, according to HMRC IR20 section 2 Working Abroad which I came across, because I am not away a full tax year, the UK is entitled to ask me to pay the difference in what I have paid here and what I would pay in uk? Do you happen to know any different?

http://www.hmrc.gov.uk/pdfs/ir20.pdf

Edited by amir_j on Tuesday 16th September 08:48

[amir_j]

GreenV8S said:

amir_j said:

samwilliams said:

You need a 33.3% increase on your standard rate

?? now confused. please an you advise me why as dont wnat to get it wrong.

Don't take this the wrong way, but it seems very clear from your questions that you aren't the right person to answer this question. Unless you understand exactly how to work this out, you're liable to get this badly wrong. I assume if this is a calculation relating to income tax that the figures involved will be significant and it will be important to you that the answer is right. I suggest you pay somebody suitably qualified to give you the answer - don't try to answer it yourself, and don't ask a bunch of random people off the interweb to answer it for you. You shouldn't trust any of us to give you the right answer; we don't even know whether you're asking the right question.

Thank you appreciated- had also sent it off to my finance person here so waitin on her reply and simulations.

[amir_j]

BigAlinEmbra said:

amir_j said:

Thanks guys- double taxation (IR20 section 2) so the uk will work out the difference in tax between here and there- ridiculous seeing as in not using any UK services etc in meantime but thats life.

If tax was to pay directly for services used then it would be a charge, not a tax.

I doubt your education was entirely private, so just consider it as paying back for that.

You didn't see the standard of my school- funnily enough now closed down The tax on my part time work whilst studying more than covered the attempts it made!!

[amir_j]

samwilliams said:

amir_j said:

samwilliams said:

You need a 33.3% increase on your standard rate

?? now confused. please an you advise me why as dont wnat to get it wrong.

At the moment, you get 80% of your rate after tax. It's not entirely clear whether you're saying that you're now going to get taxed at 40% (ie 20 + 20), or that you'll get an additional 20% tax following the initial deduction (eg you get £100, taxed at 20% to £80, and then a further 20% is taken of that £80, giving you £64).

If it's the former, you need 80% of your original rate to equal 60% of your new rate. Multiply both of those by 1.66, and you get 133.3% of your original rate being equal to 100% of your new rate.

If the latter is correct, you need 80% of your original rate to equal 64% (80% x 80%) of your new rate, which requires a 25% increase from your initial rate.

One of those is right!!

Getting taxed at 40% overall Im pretty sure ie usual UK rate split between the two countries. Many Thanks