Latest news with #PAYE
CNBC
6 hours ago
- Business
- CNBC
Here's what your student loan bill could be under new repayment plan in Republicans' 'big beautiful' bill
Republicans' One Big Beautiful Bill Act could result in higher monthly payments for many federal student loan borrowers, a new analysis finds. If the legislation is enacted as drafted, a student loan borrower earning roughly $80,000 a year (the median for a bachelors' degree holder in 2024) would have a monthly payment of $467 under the GOP-proposed "Repayment Assistance Plan," or RAP, according to recent findings by the Student Borrower Protection Center. That compares with a $187 monthly bill on the Biden administration's now-blocked SAVE, or Saving On A Valuable Education plan. No matter their income, borrowers face higher monthly payments under RAP compared to SAVE, the analysis found. For lower incomes, the difference may be just $10 per month; for higher earners, the new repayment plan can be as much as $605 per month pricier. Depending on their income, some federal student loan borrowers also face higher payments on RAP than they would have on the U.S. Department of Education's other income-driven repayment plans, including PAYE, or Pay As You Earn and IBR, or Income-Based Repayment. However, some borrowers on PAYE or IBR plans would have a smaller bill under RAP. For example, a borrower with a roughly $60,000 annual income would pay $250 a month on RAP, and $304 on PAYE, the SBPC found. The House advanced its version of the One Big Beautiful Bill Act in May. The Senate Committee on Health, Education, Labor and Pensions released its budget bill recommendations related to student loans on June 10. Senate lawmakers are preparing to debate the massive tax and spending package. Under the Republican proposals, there would be just two repayment plan choices for borrowers who take out loans after July 1, 2026, compared with roughly a dozen options now. After graduation, those student loan borrowers could either enroll in a standard repayment plan with fixed payments, or a single income-based repayment plan: RAP. Here's a look at other stories affecting the financial advisor business. Under RAP, monthly payments would typically range from 1% to 10% of a borrower's income; the more they earn, the bigger their required payment. There would be a minimum monthly payment of $10 for all borrowers. The new plan would fail to provide many borrowers with an affordable monthly bill — the goal of Congress when it established income-driven repayment plans in the 1990s, Michele Zampini, senior director of college affordability at The Institute for College Access & Success, recently told CNBC. "If Republicans' proposed 'Repayment Assistance Plan' is the only thing standing between borrowers and default, we can expect many to suffer the nightmarish experience of default," Zampini said. Meanwhile, current income-driven repayment plans now conclude in loan forgiveness after 20 years or 25 years. But RAP wouldn't lead to debt erasure until 30 years. "This kind of financial drag could further delay major life milestones like homeownership, starting a family, or saving for retirement," said Doug Boneparth, a certified financial planner and the founder and president of Bone Fide Wealth in New York. He is a member of CNBC's Financial Advisor Council. There's also "an emotional toll" to carrying student debt for so long, said Cathy Curtis, the founder of Curtis Financial Planning in Oakland, California. She is also a member of CNBC's Financial Advisor Council. "It reinforces the feeling of being stuck — especially for those who've already struggled to access opportunity," Curtis said. Sen. Bill Cassidy, R-La., chair of the Senate Health, Education, Labor, and Pensions Committee, has said his party's plans would lift the burden on taxpayers of subsidizing college graduates' loan payments. ″[Former President Joe] Biden and Democrats unfairly attempted to shift student debt onto taxpayers that chose not to go to college," Cassidy said in a statement on June 10. He said his committee's bill would save an estimated $300 billion out of the federal budget.
Glasgow Times
11 hours ago
- Automotive
- Glasgow Times
Pensioners' HMRC tax codes to change for Winter Fuel Payment
Following the announcement that pensioners who receive under £35,000 a year will now receive winter fuel allowance, HMRC has confirmed it will take back the money from those with incomes above £35,000 through their tax codes, or by asking them to complete a self-assessment tax return. HMRC said: "Winter Fuel Payments will be paid automatically without a claim, and any charges will be collected via PAYE, or via self-assessment for those with other income to declare." What is a tax code? It may look like a secret code, but the formula is pretty simple (and explained below). The most common HMRC tax code is 1257L, which is based on the Personal Tax Allowance of £12,570 - this is the amount you can earn before you need to pay tax. But, many people are paying too much tax - as we go into the HMRC tax year 2025 - 2026 it's worth making sure you aren't one of them - and if so, look at how to get a rebate. Your tax code is used by your employer or pension provider to work out how much Income Tax to take from your pay or pension. HM Revenue and Customs (HMRC) will tell them which code to use. How to check your tax code You can find your tax code: by checking your tax code for the current year online - you'll need to sign in to or create an online account on on the HMRC app on your payslip on a 'Tax Code Notice' letter from HMRC, if you get one This week's 'Joker' #martinlewis break bumper: If you have a 1250L tax code - what does the number bit stand for? a) Just an ID code b) You can earn 10x that number tax free each year c) It's your additional allowance on top of the standard allowance — Martin Lewis (@MartinSLewis) February 17, 2020 If you check your tax code online or in the HMRC app, you can also: find your tax code for previous tax years sign up for paperless notifications - this means HMRC will email you when your tax code changes Check what your tax code means You can use the HMRC tax code checker to find out: what the numbers and letters in your tax code mean how much tax you will pay what you may need to do next What the numbers mean in your HMRC tax code The numbers in your tax code tell your employer or pension provider how much tax-free income you get in that tax year. HMRC works out your individual number based on your Personal Allowance and income you have not paid tax on (such as untaxed interest or part-time earnings). They also consider the value of any perks you get from your employer (such as a company car). HMRC tax code letters and what they mean The full list can be found on the website, but these are the most common, and what they mean: L - For an employee entitled to the standard tax-free Personal Allowance S - For an employee whose main home is in Scotland BR/ SBR - For a second job or pension M - For an employee whose spouse or civil partner has transferred some of their Personal Allowance (through Marriage Allowance) N - For an employee who has transferred some of their Personal Allowance to their spouse or civil partner (through Marriage Allowance) T - When HMRC needs to review some items with the employee Recommended reading: How to claim back tax with an HMRC tax rebate If you think you are on the wrong tax code, you can contact HMRC on 0300 200 330 or speak to an advisor online via their live chat service. HMRC will contact your employer to correct your tax code and you will get any money you overpaid in tax in your next payslip. You can also claim back up to four additional years if you have been overpaying for some time.
Daily Mirror
12 hours ago
- Business
- Daily Mirror
Child Benefit change coming this summer for thousands of families
You normally pay the High Income Child Benefit Charge through self-assessment - but there will soon be the option to do this through your PAYE tax code instead The way higher income families pay back part of their Child Benefit is changing this summer. Child Benefit is worth £26.05 a week for your first child, then £17.25 for any additional child. It is a payment that is given to someone who is responsible for bringing up a child - but if you earn over a certain amount, you have to pay back part of your Child Benefit. If you, or your partner, earn over £60,000, you have to pay back 1% of your Child Benefit for every £200 you earn over £60,000. Once you earn over £80,000, you pay all your Child Benefit back. This is known as the High Income Child Benefit Charge. You normally pay the High Income Child Benefit Charge through self-assessment - but there will soon be the option to do this through your PAYE tax code instead. HMRC will contact families when a new digital system goes live, which is expected to happen this summer. You will still be able to pay the High Income Child Benefit Charge through self-assessment if you want to. In the 2022/23 tax year, 440,000 individuals paid a total of £525million in High Income Child Benefit Charge. Crucially, the figures above count per person - so if you are in a couple, you could both earn £59,000 and not be subject to the charge. You can make a claim for Child Benefit without getting the payments, in order to get National Insurance credits which count toward your state pension, if you don't want to pay the charge. The High Income Child Benefit Charge was previously £50,000 a year before you start to pay it back, but this was raised to £60,000 for the current tax year. Child Benefit is claimed by more than seven million families. You can claim Child Benefit if you're responsible for a child under the age of 16, or if they are under the age of 20 and still in approved education or training. This can include A-Levels, NVQs or even home education, but it does not include university or BTEC qualifications. The child normally has to live with you, or you pay at least the same amount as Child Benefit toward looking after them. You can claim Child Benefit if you fostered a child, as long as the local council is not paying anything towards their accommodation or maintenance, if you adopted your child. You may also be entitled if you're looking after a child for a friend or relative. There is no limit for how many children you can claim Child Benefit for, but if two people look after a child, only one person can claim Child Benefit. Child Benefit is paid every four weeks by HMRC on a Monday or Tuesday.
South Wales Argus
16 hours ago
- Automotive
- South Wales Argus
Pensioners' HMRC tax codes to change for Winter Fuel Payment
Following the announcement that pensioners who receive under £35,000 a year will now receive winter fuel allowance, HMRC has confirmed it will take back the money from those with incomes above £35,000 through their tax codes, or by asking them to complete a self-assessment tax return. HMRC said: "Winter Fuel Payments will be paid automatically without a claim, and any charges will be collected via PAYE, or via self-assessment for those with other income to declare." What is a tax code? It may look like a secret code, but the formula is pretty simple (and explained below). The most common HMRC tax code is 1257L, which is based on the Personal Tax Allowance of £12,570 - this is the amount you can earn before you need to pay tax. But, many people are paying too much tax - as we go into the HMRC tax year 2025 - 2026 it's worth making sure you aren't one of them - and if so, look at how to get a rebate. Your tax code is used by your employer or pension provider to work out how much Income Tax to take from your pay or pension. HM Revenue and Customs (HMRC) will tell them which code to use. How to check your tax code You can find your tax code: by checking your tax code for the current year online - you'll need to sign in to or create an online account on on the HMRC app on your payslip on a 'Tax Code Notice' letter from HMRC, if you get one This week's 'Joker' #martinlewis break bumper: If you have a 1250L tax code - what does the number bit stand for? a) Just an ID code b) You can earn 10x that number tax free each year c) It's your additional allowance on top of the standard allowance — Martin Lewis (@MartinSLewis) February 17, 2020 If you check your tax code online or in the HMRC app, you can also: find your tax code for previous tax years sign up for paperless notifications - this means HMRC will email you when your tax code changes Check what your tax code means You can use the HMRC tax code checker to find out: what the numbers and letters in your tax code mean how much tax you will pay what you may need to do next What the numbers mean in your HMRC tax code The numbers in your tax code tell your employer or pension provider how much tax-free income you get in that tax year. HMRC works out your individual number based on your Personal Allowance and income you have not paid tax on (such as untaxed interest or part-time earnings). They also consider the value of any perks you get from your employer (such as a company car). HMRC tax code letters and what they mean The full list can be found on the website, but these are the most common, and what they mean: L - For an employee entitled to the standard tax-free Personal Allowance S - For an employee whose main home is in Scotland BR/ SBR - For a second job or pension M - For an employee whose spouse or civil partner has transferred some of their Personal Allowance (through Marriage Allowance) N - For an employee who has transferred some of their Personal Allowance to their spouse or civil partner (through Marriage Allowance) T - When HMRC needs to review some items with the employee Recommended reading: How to claim back tax with an HMRC tax rebate If you think you are on the wrong tax code, you can contact HMRC on 0300 200 330 or speak to an advisor online via their live chat service. HMRC will contact your employer to correct your tax code and you will get any money you overpaid in tax in your next payslip. You can also claim back up to four additional years if you have been overpaying for some time.
IOL News
18 hours ago
- Business
- IOL News
Bellville business owner fined R96,000 for failing to submit tax returns
The Bellville Magistrate's Court has fined a business owner R96 000 for failing to submit various tax returns over several years. "Mayet was the sole member of A and Y Wholesale Retail Enterprise CC, which traded as a wholesale retail enterprise trading under the name and style of Plastipak. The Bellville Magistrate's Court has fined a businessman for failure to submit income tax returns, Value Added Tax (VAT) returns, and Pay as You Earn (PAYE) returns. "The company was registered for Income Tax, VAT, PAYE (EMP 201) and PAYE (EMP 501). "Mayet was the representative VAT vendor, representative employer, and the public officer of the company at the time of the commission of the offences. "He failed to submit Income Tax, VAT, PAYE (EMP 201) and PAYE (EMP 501) returns when they were due. "The offences were committed over several years: VAT returns for a year, PAYE (EMP 201) for two years and PAYE (EMP 501) for five years," Ntabazalila said. "The returns remained outstanding until they were submitted on May 27, 2024. "The accused and his company were convicted on an Income Tax return on behalf of A and Y Wholesale Retail Enterprise CC, two counts of failure to submit VAT returns, five counts of failure to submit PAYE (EMP 201) returns and eight counts of failure to submit PAYE (EMP 501) returns."
