Taxcodes are meant to help employers and employees to understand the process through which the amount that they are supposed to pay as tax is arrived at. The code is actually in two parts; one part is made up of numbers and the other part is made up of letters. Actually it is a good source of information about the taxation plan. With its help, one can know what benefits he is going to enjoy and tax free allowances that he is going to get in a particular year. If someone has knowledge of these codes he can also tell a lot about the taxpayer, whether he is suffering from severe disability or anything else
There are many type of taxes in this era, and the one that we are going to discuss is the BR
Non-Cum tax code.
Most people are confused when it comes to tax and tax issues. So for your help here are some questions about NONCUM tax code is answered in simple language
What Is Non-Cum All About?
If HM Revenue and customs department informs you that your tax code for this year is BR NONCUM code, then they mean to say that this year you will not get any cumulative allowances and your income will be taxed at basic rate. In this year it is 20% of your income. This means if your income for this year is 20000 pounds then you will have to pay 10% of this income, which is 2000 pounds
Benefits Of Non-Cum Tax Code
This tax code has a lot of benefits which a Noncum tax code holder can enjoy. This tax is charged proportionally which saves an employee from progressive difficulties that come with the determination of the amount of taxes that one was supposed to pay. In Noncum system whatever your income is you will only have to pay 20% of your income which is beneficial for an individual. This is because, for other taxcodes, the tax rates increase with increase in income.
For example, if there is a person having a BR Non-cum tax code he will have to pay only 20% of his income, whether he earns 1,000 pounds or 10,000 pounds. On the other hand if one will have to pay based on a progressive tax platform, that person is likely to experience a lot of problems.
Drawbacks Of Non-Cum Code:
There are surely some benefits of the non-cum tax code, but there are also some drawbacks of this code. If there is a person who is having Noncum taxation code he will not have any tax-free personal relief or allowance. This is a big drawback of this particular code. Other tax codes give this facility to the people that they can have some personal allowances and relief.