Martin Lewis money saving expert: Find out your take home pay – income tax calculator | Personal Finance | Finance

The financial journalist has earned a reputation for helping people with their personal finances. Through his MoneySavingExpert website, Martin offers tips and tricks to save money and keep up to date with announcements. Recently, he has offered advice and spoken to the Chancellor regarding changes brought about by the coronavirus pandemic. 

Upheaval, however, has coincided with a new tax year, meaning there is more information to learn. 

The 2020/21 tax year began on April 6, 2020, and brought with it a number of financial changes.

This includes changes to income tax which can greatly affect finances.

Income Tax is a tax paid on income, such as for money earned from employment, or the State Pension.

Most Britons receive a Personal Allowance of tax-free income, usually set at a standard £12,500 per annum, the amount tax does not have to be paid on.

The basic rate of general UK income tax then stands at 20 percent, for most over £12,500, up to £50,000. 

Once you understand your personal allowance, anything above that figure becomes subject to income tax.

And income tax is calculated through earnings in bands, which increase the amount of tax you have to pay as your earnings increase. 

READ MORE: State pension: How your payments could be affected by furlough

To work out if you need to pay Income Tax, you should add up your taxable income and work out your tax free allowances.

You should then subtract your tax free allowances away from your taxable income. 

Martin Lewis’ calculator only makes a general calculation of income tax, and does not take into account individual variables.

The website therefore encourages users to reach out to the Tax Office if unsure about the calculation. 

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