Personal financial planning – how much should you save for tax?

29th April 2015 by NASGP

Personal financial planning – how much should you save for tax?

Perhaps the most important piece of personal financial planning that a self-employed locum GP must ensure is the amount of savings he or she is making for their income tax and national insurance liabilities. Matters are further compounded if the locum is obliged to make student loan repayments.

If we take a locum, who is in the NHS Pension Scheme and is making their monthly superannuation contributions, then the savings required for the fiscal year ended 5 April 2016, are as follows:

Net income after expenses but before Superannuation Percentage savings for income tax and NIC Percentage savings for income tax and NIC and student loan repayments
£50k 20% 26%
£60k 23% 30%
£70k 25% 32%
£80k 26% 33%
£90k 28% 35%
£100k 29% 36%

It should be stressed that the above percentage savings do not take into account any additional liabilities which may accrue on investment income such as bank or building society interest, dividends from shareholdings or rental income.

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