Online Signature Lawfulness for Payroll Deduction Authorization in United Kingdom

How to eSign a document: online signature lawfulness for Payroll Deduction Authorization in United Kingdom

all right today we are covering payroll and i want you to be able to understand better what your check looks like when you start a job um what uh the difference is going to be between your gross earnings and ultimately your take-home pay so we're going to go over both benefits and deductions that come out of your paycheck now there is a difference between your gross you should write this down gross pay and your net pay so if you have a job and you're working and you're getting paid uh let's say 15 an hour and you worked 20 hours this pay period then you would have earned 300 gross but that's not what you get to take home so gross is how much the total amount is the all of the earnings and then net pay is what you get to take home after both deductions and benefits have been taken out of your check so net pay is all what i would call take home income and ultimately this is the money that you're gonna have to spend this is what you'll use for your rent food groceries utilities all that good stuff not what you've earned so for uh people just entering the workforce or if you're in high school and you get your first job and you know how much you get paid per hour and you're very excited about seeing that first check and then you get hit with the reality that it's a lot less than what you've earned that your take-home is a lot less is going to be because of both deductions and because of benefits so let's go through these together i'll start with i'll start with deductions so in your deductions you're going to have to pay federal income tax so your federal tax everybody pays a federal tax and that the amount of federal tax you pay is on a scale now i'll have a separate lesson for taxes and uh walk through the different income brackets and how those percentages are applied when you break an earning threshold okay but everyone has to pay federal tax and in that lesson um that separate lesson we will go over uh what that federal tax where it ultimately goes uh what it's utilized for then we have state tax so if you are in illinois if you're in new york if you're in california or florida you're going to have a different and varying state tax in illinois we have a healthy state tax in states such as texas and florida there is a zero state tax so if you are employed and you live there then you would in a state like texas or florida you would only pay a federal tax you would not pay a state tax so that's uh in earnings savings that's money you get to bring home that's more take-home income for you then we have social security now social security i want you to think of well every time you get paid money gets taken out of your check every time gets taken out of your check and applied towards your social security and i want you to think of social security as a bucket okay and we're going to label that social security we're going to make those dollar signs also so social security is going into your bucket and the idea is that if you don't set up a retirement account um when you do retire at 65 or 67 and you're no longer earning money you will need uh income to maintain your living expenses your rent groceries utilities and the things that you need so in order to be able to do that what the government has is structured a form of savings where they take your money and force it into a savings program so that when you hit that retirement age you can start drawing or uh receiving social security benefits so ultimately when you're at this age when you're 65 67 or above you're getting paid back the money that you contributed that you started when you got your first job at 17 18 19 all the way up until your retirement age all that time you'll be contributing money into this bucket so it's a safety net for you and because everyone puts money into it then when everyone reaches their retirement age they pull money out now you have to have worked uh well that's you have to have a certain amount of time worked in order to qualify for that and that's a separate lesson altogether but the big picture is social security is a retirement kind of safety net for when you hit retirement age then we have medicare medicare medicare's a separate bucket okay and what medicare is let me see let me do it this way so what medicare is is you're contributing you're putting money into so that when you reach the age of uh you reach your retirement age and you don't have money to buy or pay for insurance at that point you'll have access to medicare which is the federally funded insurance program so think of reaching the age of grandmas and grandpas right uh when you get to 65 67 you are not going to be working or you don't want to work so that means you're not going to have earned income you're not going to be getting a paycheck so you need money to live off of so that's the social security and if you're not working then you don't have money to pay for insurance so you have a safety program here that you've been contributing to and paying into when you were younger and that's going into medicare now and when you reach that age you are paying per month a certain amount for medicare but it's not going to be the huge uh monthly cost that um or bi-weekly costs however often you get paid that americans see now because health care is definitely very expensive so when you get paid when you earn money you're going to have a federal tax taken out and the bulk of states you're going to have estate tax taken out you're going to contribute towards social security and that is a safety net for you when you hit retirement age and you're going to have medicare taken out and that's going to be your health insurance bucket think of it that way for when you hit retirement age now depending on the size of your employer they're going to offer benefits and those benefits will include things like health insurance a 401k which is a retirement plan they'll offer sick days sick days with sick pay or sick days with pay and then vacation time vacation uh days with pay so depending on where you work if you want to go on vacation uh your boss or the company would say you can take as much vacation time as you want but you're not gonna if you're not working you're not getting paid depending on the employer they want to offer a benefit to you and say listen not only would you be able to take time off but we're going to pay you when you're on vacation with your family so that's a nice benefit that's a nice perk typically it's not unlimited uh it may be a week or maybe two weeks and you have to build up you have to be there for six months or a year before you start getting that paid time off but let's look at health insurance so when you work for a company or a business and they offer health insurance if the business is big enough then what they're going to do is help you offset the cost of what again is very expensive health insurance the employer will is going to pay 82 of the cost of the insurance for you and you will pay the other 18 so that is a huge savings so money is taken out of your check to go towards paying for your health insurance that money that's being taken out is to cover your 18 so if you're young and you don't go to the doctor you might go six months a year you might go three years without going to the doctor but every pay period money is taken out of your check and you're paying for the protection so that in the event of an emergency where you do end up in the emergency room or on the operating table or you get ill whatever happens you have insurance to limit your cost your risk and your exposure to high medical costs so even though you don't go to the hospital because you're super healthy you haven't had any events you're paying into your percentage what's your responsibility to cover your health insurance and that's important um americans want health insurance especially if you have a family you want to make sure that your spouse and your children are covered as well the employer is covering the lion's share now just because you have money taken out of your check and it's going towards your health insurance doesn't mean that when you go to the doctor you don't have a copay or that you have zero bills this is just for protection to limit your exposure okay so that's health insurance and it's a huge benefit before the affordable care act most people would go into a job that needed insurance would go into a job for the insurance benefit uh being what's driving them into the job more so than what the job is paying per hour if that makes sense so um that's how most americans gained access to health insurance and health coverage and that is through an employer and through group coverage it's a way to make sure that you weren't being denied insurance coverage because of a pre-existing condition maybe something you were born with maybe you have asthma and you have uh problems with your breathing or your lungs and that's you need expensive medication if you try to get insurance the insurance may say you're too expensive we don't want to bring you on and you're denied but you would be able to get that insurance even with a pre-existing condition uh through the employer so after the affordable care act uh was passed then there were more options there were different exchanges added so even independent workers freelance uh and freelance individuals would have access to healthcare to health insurance the next one i want to go over as far as benefits this is really crowded here i'm going to erase the sick days of vacation days and i want to go to the 401k now the 401k is yet another bucket the 401k is the 401k is another retirement safety net so every time you get paid you're putting money money's taken out of your check and put towards your retirement so once you hit retirement age you can start uh withdrawing from your own retirement account not every company not every business offers a 401k some uh if you work for a not-for-profit it would be a 403 b but if you don't work for a company and you're self-employed then your option at that point would not be a 401k it would be an ira and an ira is an independent retirement account now there are caps the benefit of putting money into your retirement account is that you are not going to pay taxes on the money that you earn today that goes into grow for your future so that's a huge benefit but because you're not paying taxes today when you earn that money the government has a cap as to how much you can put in there and it's roughly about thirteen thousand dollars per year now separately you can get an ira or if you work somewhere that doesn't offer a 401k and you say i still want to put money aside for my elder years and for my retirement then you can put money into an ira and that uh cap annual contribution is roughly about six thousand dollars so if you want to have both you could do that and so ensuring yourself greater protection which means that when you get to the age of the grandmas and the grandpas you will have social security which is not going to be a lot um but you'll have some money coming in from there you will have medicare as your insurance backup your safety net here which will help you again limit your costs on procedures because um elderly people need more medical attention and they're not as likely to go two and three and four years without having to see a doctor like young people and then you have your 401k if you have the benefit of setting this up through an employer you have your retirement account here and then you also have a separate retirement account now you can always set up an investment account with a brokerage firm uh or an investment firm you can put money in and you can invest and you can work on those things the idea is that when you hit retirement age you have more than one source waiting to protect you so when you're young you're healthy you have energy and time you want to earn that money you want to protect it you want to build it up so that when you get older you're tired you don't have as much energy and you don't want to work you've been able to put some things aside to make future your future life for you more comfortable and so it's all about what gets taken out of your check when you have the ability to contribute that with the 401k what i want you to be aware of is that a lot of businesses because it is a benefit they want to offer this to their to their employees and what they'll do is they will offer a match so uh big companies will offer match and they'll say up into this amount so up into two percent or three percent of whatever you contribute we will match that dollar for dollar which means that that is free money so if you were to contribute um and they will allow you to put you could get in essence let me rephrase that your employer you may be able to put again up to 13 000 in your retirement account your 401k per year and your employer would say we will match up to six thousand dollars so if your employer matches you up to six thousand dollars you could put thirteen thousand into your retirement plus your employer 6 000 that they put in to match your original six that means that you'll have 19 into your account or you could put in six plus they're matching six and that leaves you at 12. when you have a match you want to make sure that you're taking advantage of that because if you only put in 3 000 and they will match up to 6 then they're going to match your 3 but basically you're walking away from three thousand dollars of free money so that's important as well um but the big part is understanding benefits deductions why it's important in a separate lesson i'll be able to break down why these are essential the federal and state taxes um how they're utilized and how everyone benefits overall from the taxes they're taken out and well it's it gets uh it gets very interesting when we start talking about uh higher taxes versus slower is everyone paying the right amount of tax how do we make sure that it is um a fair tax system and when do we have a say as to how our tax dollars are utilized to serve the greater good so all of that in a much different and much more detailed lesson these are benefits and deductions for payroll payroll income if you have any questions leave them in the comments