10% Overtime Question

[sblack]

Hi,
Just a quick question on overtime and the 10% rule.
For Example:

If for example I earn £2000 before tax - £1600 take home pay then anything earned over £1760 then has to declared.
If I earn £200 overtime before tax which equates to about £160 after tax, Total (£1800 before tax £1760 after tax) do I have to pay any extra to my IVA.
Is the overtime also based on take home amount or the before tax amount.
This sounds really complicated but it probably isn't.
Its just the before and after tax issue.[?]

[Viki.W]

Hey sblack, lovely to see you![:)] Hope you're ok.

Now I'm confused.[:I] You would only pay the net amount over but whether it's 10% of net or 10% of gross, it would still work out the same........wouldn't it?[?]

Sorry, better wait for someone else!!!!! XXXXXXXXX

[sblack]

Hi Viki, I'm fine thanks,

I suppose it would, I think.
It's just the 1st time we have done overtime and it came the same time as the tax rebate and the figures got really confusing.

Thanks.

[bev.nn]

Hi - 1st of all, how lucky are you just having a 10% overtime clause - most of us seem to be stuck with a 50%one!! Anyway, thats great for you, and everyone's circumstances are different, but just thought I'd let you know that in my experience, the overtime has been taken off the net figure - in other words, the amont you receive after all your take-offs etc. Hope this helps.

[Abby]

i might be talking rubbish here but i thought you could keep the first 10% of over time then, you give 50% to iva and keep 50%, this is after tax. eg £100 overtime, you keep the first £10 then divide the remaining £90, so £45 to you and £45 to iva. I think, but wait for the experts. x

[Viki.W]

Abby, it's 10% of your wages, so if you normally earn 1000 net per month but you earn £500 overtime then your income that month is £1500, you can keep £1300 and then £200 goes to IVA. I think that's right.

[Abby]

said i might be talking rubbish. [:p]

[Viki.W]

I might be too! [:I][:o)]

[Abby]

oh well at least we try [:)][:)]

[louiseh]

A 10% rule now applies to my overtime, and it is as Abby states, after tax you keep the first 10% ie £10 out of £100, the remainder is then split 50%. So you keep £55, IVA gets £45 out of £100 overtime money after tax.

[Viki.W]

Louise, don't forget you will be able to earn an extra 10% of your usual income before this rule applies. So if you earn £1000, you can earn £100 overtime and not have to pay any over.

So going back to your query sblack, it would go on your take home pay and if that is £1760 and you earn £160 extra overtime then you wouldn't have to pay any to the IVA as this is under the 10%.

[Abby]

ah i get it, thought it was just 10% of your overtime, not 10% of the actual take home pay.[:)]

[Viki.W]

I'm pretty sure that's right.[:)] X

[MelanieGiles]

It is 10% of the total take home wage which can be retained before the 50/50 split. So if you earn £1,000 per month, you could earn an extra £100 per month before having to pay any addional monies over.

[louiseh]

In my case the 10% definately applies to overtime and not 10% of wages, had it confrimed by IP who clearly stated the figures. So I guess it depends on the IVA.