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As mentioned in NIM01251, the annual maximum rules are modified for the 2023 to 2024 tax year.

Example 9

An employee has two separate employments. »Ê¹ÚÌåÓýappir total earnings for the 2023 to 2024 tax year are £100,000. »Ê¹ÚÌåÓýappy are paid monthly in each job and receives the same amount of earnings in each earnings period. »Ê¹ÚÌåÓýappir maximum Class 1 liability is calculated as follows:

Step 1

Deduct the relevant Primary Threshold from the relevant UEL and multiply that figure by 53.

967 - 242 = 725 x 53 = 38,425

Step 2

Multiply the result of step 1 by 11.5% (because the calculation is for the 2023 to 2024 tax year)

38,425 x 11.5% = 4,418.88

Step 3

Add together so much of the person’s earnings from each employed earner’s employment as exceeded the Primary Threshold but did not exceed the Upper Earnings Limit at the time the payment of earnings was made.

»Ê¹ÚÌåÓýapp earnings between the PT and the UEL for the first employment is £37,430. »Ê¹ÚÌåÓýapp same is the case for the second employment. »Ê¹ÚÌåÓýapp result of this step is therefore 74,860

Step 4

Deduct from the total found at step 3 the amount produced by step 1

74,860 - 38,425 = 36,435

Step 5

If the figure produced at step 4 is a positive figure multiply that figure by 2%.

If the figure produced at step 4 is a negative figure, it is treated for the purposes of step 8 as nil

36,435 x 2% = 728.70

Step 6

Add together so much of the person’s earnings from each employment as exceeded the Upper Earnings Limit.

»Ê¹ÚÌåÓýapp employee did not have any earnings above the Upper Earnings Limit in each individual employment, so the result of this step is 0.

Step 7

Multiply the result of step 6 by 2%.

0 x 2% = 0

Step 8

Add together the results of steps 2, 5 and 7.

4,418.88 + 728.70 + 0 = 5,147.58

»Ê¹ÚÌåÓýapp employee’s maximum for the 2023 to 2024 tax year is £5,147.58