[exstatic]

Hey Guys,

I have been offered a job in the UK working in IT as a Systems Administrator, my gross salary will be 40k (GPB) per year, with a 600 (1.5%) pernsion contribution.

What I wanted to know is how much will I take home after tax? Is this a high/average/below average salary?

If I do have to pay an income tax, can I claim that back at the end of the tax year similar to what I do in Australia?

Thanks for your help!

Cheers

[Bluey]

Final figure will depend on whether you are employed by the company which means that you are taxed at source or whether you are treated as an IT contractor, which means you have to arrange to be paid through a limited or umbrella company, for example.

You are likely to lose approx 25-27% in tax and national insurance contributions through the first option.

Here's the official Inland Revenue formula and a beginners guide to tax.

http://www.hmrc.gov.uk/rates/it.htm
http://www.direct.gov.uk/MoneyTaxAndBenefits/Taxes/BeginnersGuideToTax/BeginnersGuideToTaxArticles/fs/en?CONTENT_ID=4015566&chk=U5MTGt

Here's a few of many calculators available to calculate income tax

http://www.tfpl.com/permanent_recruitment/candidates/pcalculator.cfm
http://www.borrowing-pru.co.uk/home/calculator/income_tax

[exstatic]

Thanks for the reply..

At the end of the tax year, can you claim your tax back, similar to how we do in Australia?

Also, what is the median salary range in the UK? is 40k per year high/low/avg ?

[Bluey]

I have no knowledge of the australian tax system and refunds - other GumTree'ers will have to provide this info for you.

If you are British, your taxes disappear the moment you are paid and you only get a refund if you've overpaid - for example, if it's discovered that you are on the wrong tax code.

Tax & Death = Inevitable.

However, last year's average salary across the UK was 22k, with 25k in the south-east and 31k in London so you will earn almost twice the national average wage or approx 24% more than the average Londoner (though you will encounter much steeper living costs).

http://money.guardian.co.uk/pay/story/0,13871,1415864,00.html

To put it another way, with the hourly minimum wage in the UK about £5, you may be served your morning coffee by someone earning a quarter of your salary.

Although it's hard to baseline average Sys Admin salaries as it depends on experience, location, specialism and employment sector, this site has published figures which say your salary is spot-on

http://www.itjobswatch.co.uk/jobs/uk/systems%20administrator.do

Hope this info is helpful

[exstatic]

Fantastic reply Bluey, thanks for your help.

[shane2006]

Hey Mate,

The tax system is similar to Australia. You'll get tax back if you don't work the full year and/or overpay your taxes

[Bipolar Bear]

And here's a tip: when it comes time to claim back your tax dont use one of these agencies that suposedly "specialize" in tax refunds. I made the mistake of enquiring with 1st contact before i looked into doing it myself, they wanted to take 16% of whattever the refund was! And I'm still getting spam from them to this day! All you gotta do is send a letter to your tax office with your P45/P60's and they will send you a cheque. Too easy and saves you a heap of money.

[Ugger]

£40k is in the higher salary bracket for sure. A Management accountant would earn around that. Average salary in London is about £25k, I think.

You won't be able to drive a Ferrari, but you'll be able to live, travel, go out and entertain yourself comfortably.

[exstatic]

Thanks for the feedback..

So based on that Salary.. and having a partner earning maybe about 25-30k, what would be an ideal rent to budget for?

I have been looking in the Notting Hill / Kensington / Chelsea area for approx 300 a week.. and have found some reasonable places.. should I up the budget.. or stick with it? Is this expensive or cheap?

Thanks!
ex

[exstatic]

Sorry I meant to say my partner will be earning 15-20k!

[sunda]

Hey Bluey,
ve read the Guardian article but still in doubt.
Are mentioned salaries/averages before or after taxes?

[Bluey]

I assume as they are referring to Salaries, the article refers to Gross wages so you'd need to knock off around 23% to get an idea of net take-home pay. However, the article is confusing as clearly the wage given for a general assistant would be lower than the minimum wage.

Check out statistics on the Office for National Statistics website to confirm this though it's a bit dry.

http://www.statistics.gov.uk/cci/nugget.asp?id=285

Also, you have to be aware of the limitations of using averages - okay as a rule of thumb but relatively few people actually earn bang on the average - it just takes in wide variances from thousands on the minimum wage to a handful of CEO's coining it in.

Bluey

[dobbie82]

I dont know where they get the avarage wage from but 40K is a very high wage (almost obscene!)


I am from wales, the avarage wage where I am from is about 12k (10k normal for hotel staff etc, 16k considered very high wages, bank manager, senior council staff etc)

I now live in the lakes, wages 10-18k a year for most jobs I see advertised,

[exstatic]

So I shouldnt be complaining about paying £150 a week rent?

[dobbie82]

no, back home in wales £60 a week will get you a 2 bedroom flat privately or a 3 bedroom council house with garden

in the lakes I pay £125 a week for a 2 bedroom flat and that is only because the tenency has been running 5 years, most flats/houses are £150-200 a week here.

London can be £250 a week easily!

I assum on £40k you will pay 40% tax, but you gt it back when you go home. National insurance is about 11% of it and you dont get that back, but you get free healthcare if you need it.

[dansky]

Guys,

Great to see that people are actuaklly capable of having a constructive and informative exchaneg of messages on here!

exstatic - - take notice of Bluey above all others that have replied. He/she definitley know what they are talking about.

£40k is an above national average salary and you can live quite comofrtably- not overly comfortably in London on this wage - especially if you and your partner have a combined income of c£70k.

FYI - I am a specialist recruiter in London for an MNC - market leaders in Oz - should give you an idea who I work for - begins with H and end in N - three letters in between - not into this free advertising stuff!

Limited company / using an umbrella is an excellent way to go if you can - there are many benefits as bluey rightly pointed out. There are some very competitive rates for management - look at Mimax.

I would go perm with a company to give you the security you need to settle in over here and then go contract/interim - too many antipodeans undersell themselves at first but this is clearly a great way to geta foot in the door and make serious money with impressive day rates and contract periods....check out the IT banking market in London where rates are going through the roof.

As for the renatl issues - yoou need to be looking at £150 a week as a minimum to live in a nice place in a good area!!

Good luck!

[Schibeck]

Mate since coming to london Ive made many friends from many different backgrounds who come here to start and new life and possibly increase the quality of the lives of there families.

They work 60, 70 even 80 hour weeks just to get enough money to survive.

I think you should stop your bitching , wondering if 40K is enough and if god forbid you might lose just a little too much in tax and just be grateful that youve got an education, a good job and the prospect of a good future.

Wake up...

[Bluey]

Schibeck,

I didn’t detect any bitching or desire to evade taxes on the part of the person who posted this or the responses to it or a lack of understanding about how lucky they are.

It was just a simple enquiry from a person living abroad to understand the salary and get an idea of living costs in London and the UK tax system. It is illegal and immoral to evade taxes. It is not illegal or immoral to seek to minimize them and that’s a key distinction.

You may think it is heroic that you know lots of people who came to the UK and work long hours for low wages to support their families.

From a different perspective (and I do not share it but I want to draw your attention to a different viewpoint), your friends experience of long hours, low wages and high expenses are actually caused by their very presence. It’s a bit like all the single drivers of cars stuck in a long traffic queue cursing the traffic and wondering what is causing the hold up.

Although not particularly relevant to this thread (and I hate going off-thread) some people in the UK remain unconvinced of the benefits to the country from immigration and believe it only benefits the immigrants themselves at the expense of the country. There is a tendency to prefer working visas restricted to those who came to the UK to fill recognized skill shortages, such as those in the fields of medicine and IT and who can more readily contribute more back to the infrastructure through taxation.

In fact, an independent research body (Migration Watch) indicates that part of the reason why wages are so low in London and costs are so high are because a third of the population of London derive directly or indirectly result of immigration, the majority unskilled, which causes pressure on housing (pushing up rent levels) and depressing wages because the labour market is so plentiful.

So just be happy for the chap – he clearly knows he is lucky.

Unfortunately, the GumTree is not a particularly good place to discuss the merits of migration as it soon descends into a moronic set of taunts between BNP Goons and those who brag how much they've got out of the UK without putting anything back.

[ABCDiamond]

[ABCDiamond]

[exstatic]

Wow, This has been a great thread! Its great to see that it isnt filled with junk, and hopefully others can benefit from it in the future.

Guys you have answered all my questions in full, and if not more, i'm very apprciative of that.

So I have taken the 40k job, and have found myself a little place in Barons court for £280 per week including furniture and bills, the quality of living might be less for more, however the life experience just can't be matched, so its a good trade off!

Thanks again for your help, and if you guys are keen to catch up for a beer, drop me a line!