How does wagecorp calculate my take home pay?
There are set rules for calculating take home pay, and this depends upon you situation and tax codes. Your National Insurance contributions are deducted as a percentage of your earnings this percentage is identical for all companies. Income tax calculations are a little more complicated; this is essentially how it works.
Everyone has a tax code which determines their tax-free pay e.g. the standard tax code for 2019/20 is 1250L, which means you can earn £12,500 in a year before you have to start paying income tax.
Every pound you earn over your tax-free allowance will be taxed at 20% up to £37,500; every pound you earn between £37,501 and £150,000 will be taxed at 40% and finally, any earnings above £150,000 will then be taxed at 45%.
This gets more complicated when tax codes change and the perimeters by which you start to pay tax will change.
Many UK Umbrella Companies may offer higher take home pay, however these are schemes which may be high risk and result in you receiving a tax bill.
As a PAYE Umbrella Company, wagecorp will deduct and pay to the HMRC your correct Income Tax and National Insurance deductions as you earn, just like any other employment.