# Questions about salaries in the UK vs. USA



## jclh (Mar 9, 2013)

Hello,

I am wanting to look for a job in my profession but am a bit confused about how salary/cost of living may work in the UK vs. here in the US.

It is my understanding that you pay a portion of your salary to the national health service, beyond that are there other healthcare costs (i.e. copays deductables etc)?

I found a tax calculation website and it appears that for someone in the 80k pound per year range will pay about 50% of salary in taxes, is that about correct?
Is that just taxes on the national level? Are there additional local taxes?

Also, I see jobs listed for a certain amount plus benefits... what would benefits in the UK generally mean?

I've looked at a website called numbeo . com where it compares salaries in our city vs. london... is that a good guide to go by or are there other factors it does not take into account?

I know, lots of questions... I'm just in the confused stage  I just don't know what I don't know right now 

Thank you!


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## WestCoastCanadianGirl (Mar 17, 2012)

The only immediate healthcare costs that I've run into in the 6 months that i've been here is approximately £16.... that was for a prescription nasal spray for my allergies (late October) and a bottle of anti-inflammatory ear drops for the raging case of swimmer's ear (Monday) I've been fighting. 

I've been to see the doctor twice and my husband called the NHS Medical advice line, all at no cost to us.

I've bought other medications as well, but they've all been OTC (cough syrup, Advil, and Voltaren topical gel/tablets etc)... I don't count their costs because they were things I could (mostly) buy OTC when I lived in Canada (the Voltaren tablets are on prescription in North America but not in the UK, but they're < £7/box of 9 tabs). 

So, compared to the USA (and even Canada), once you qualify for NHS coverage, it's a pretty sweet deal here (in Canada, I was paying ~ USD 50-60/month for provincial health insurance and USD $9 dispensing fee plus drug cost for prescriptions... I had Blue Cross through work, so I had a 20% copay and a CAD $100 deductible).


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## brian2012 (Jan 15, 2012)

jclh said:


> I found a tax calculation website and it appears that for someone in the 80k pound per year range will pay about 50% of salary in taxes, is that about correct?
> Is that just taxes on the national level? Are there additional local taxes?


I've always found Listen To Taxman to be accurate in calculating income tax. It says an 80k salary earner will pay £21,884 in tax and £4,937 in national insurance, which is 33.53% total. That's all the tax you'll pay, there are no additional local taxes.


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## WestCoastCanadianGirl (Mar 17, 2012)

There's also the Council Tax, but that's more akin to what you'd pay in North America to your city government for sewer, garbage collection, schools etc.


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## LaraMascara (Oct 19, 2012)

brian2012 said:


> I've always found Listen To Taxman to be accurate in calculating income tax. It says an 80k salary earner will pay £21,884 in tax and £4,937 in national insurance, which is 33.53% total. That's all the tax you'll pay, there are no additional local taxes.


Council Tax!!! 

We all have to pay an additional Council Tax on top of our rent/mortgage and it is normally over 100 a month.


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## LaraMascara (Oct 19, 2012)

I moved to London from Manhattan. 

Based on my personal experience, the salaries in the UK are much, much, much lower, and the cost of living, in general, is much, much higher, at least in London.


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## nyclon (Apr 3, 2011)

jclh said:


> Hello,
> 
> I am wanting to look for a job in my profession but am a bit confused about how salary/cost of living may work in the UK vs. here in the US.
> 
> It is my understanding that you pay a portion of your salary to the national health service, beyond that are there other healthcare costs (i.e. copays deductables etc)?


There is charge for prescriptions of £7.65 (per prescription) which is set to rise to £7.85 on 1 April 2013. There is a charge for NHS dental services:

NHS dental charges - The NHS in England - NHS Choices

You'll also pay to have your eyes examined.




> I found a tax calculation website and it appears that for someone in the 80k pound per year range will pay about 50% of salary in taxes, is that about correct?
> Is that just taxes on the national level? Are there additional local taxes?


To figure out take home pay:

UK PAYE Salary Wage Income Tax Calculator 2012 / 2013 / 2014. Updated for 2012 / 2013 HMRC inland revenue tax year. Calculate wages pension national insurance and student loan repayments online.

You'll pay council tax which covers local services. It will vary depending on borough and is roughly based on the size and value of the property. £150/month would be a good base to work off of.




> Also, I see jobs listed for a certain amount plus benefits... what would benefits in the UK generally mean?


Even though you would be eligible for the NHS should you have the proper visa, some employers may offer private health or dental insurance. Other things include child care vouchers and bike to work schemes.



> I've looked at a website called numbeo . com where it compares salaries in our city vs. london... is that a good guide to go by or are there other factors it does not take into account?


I don't know. I think this type of website relies on personal input so it's very subjective. As a reference, salaries tend to be lower in the UK than the US for similar jobs.





> I know, lots of questions... I'm just in the confused stage  I just don't know what I don't know right now
> 
> Thank you!


The biggest hurdle is finding a sponsor. There aren't many Tier 2 work visas available and in order to qualify, an employer must first prove that there is no one in the UK or EU who can fill the position. That's a pool of 500 million people.


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## brian2012 (Jan 15, 2012)

LaraMascara said:


> Council Tax!!!
> 
> We all have to pay an additional Council Tax on top of our rent/mortgage and it is normally over 100 a month.


My bad! Thought we were talking income tax. 


LaraMascara said:


> I moved to London from Manhattan.
> 
> Based on my personal experience, the salaries in the UK are much, much, much lower, and the cost of living, in general, is much, much higher, at least in London.


London is one of the most expensive cities in the world. My brother's apartment is less than half the size of mine in Bristol and he pays almost three times my rent. If you go up north, things are way cheaper again. It is higher, I just wouldn't say "much much higher".


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## LaraMascara (Oct 19, 2012)

Yup, cheaper in the north, but the wages go way down, for the most part, if you move up there. 

Wages are higher in London. 

So, in the end, same/same. 

Up north, lower rent, but lower wages too.


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## brian2012 (Jan 15, 2012)

LaraMascara said:


> Yup, cheaper in the north, but the wages go way down, for the most part, if you move up there.
> 
> Wages are higher in London.
> 
> ...


I think rent is still comparatively expensive compared to wages in London. Sure you earn more, but not three times more than Bristol etc.


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## LaraMascara (Oct 19, 2012)

Yeah, in my opinion, no matter where you live in the UK, the wages are simply not high enough in the UK, compared tot he general cost of living. 

Everything seems very expensive here and the wages seem very low to me. 

I mean, the wages are not good, at least not in my field, nor are they good in my husbands field, or any of my friends fields... Maybe there is a field or two that are good, but I have no clue what they are. 

Doctors make less here, for sure... lawyers maybe do well? But, as well as in the USA? I don't know.

Bankers, maybe? 

But... I know several bankers who came here from NYC to work, and they all ended up going back to NYC, and they all seemed to feel they had a 'better lifestyle' in NYC... So, maybe not bankers? I don't know.

The people I know who have money in the UK were born into that money. They did not earn it. 

I know a lot of people here who were born into money, and they are the only people I know who have money. 

And they then began a business, with their family money, and it earned them some more money, because all of their friends who had family money used their business. So, they just sort of, 'pass their money around between each other' in a way. 

All the men who went to Eton. That crew has money. 

I have not met any self made, seriously successful people here, aside from some actors and artists and that lot, although they must exist... Right!?

I know many self made successful people in the USA. 
MANY! But, none here. 

Anyway, the UK is very expensive, and the taxes are very high (but taxes, for now, afford you access to the NHS), the housing costs are high, the food costs are high, electronics, and home items, and clothes, are all very expensive, and the wages are low.


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## jclh (Mar 9, 2013)

Wow! Thanks everyone... great replies!



brian2012 said:


> I've always found Listen To Taxman to be accurate in calculating income tax. It says an 80k salary earner will pay £21,884 in tax and £4,937 in national insurance, which is 33.53% total. That's all the tax you'll pay, there are no additional local taxes.


That seems much more palitable than the 50% I was thinking  

I'm just concerned... I want to be able to support my family of 4 on my single income and have some disposable left over to be able to travel to mainland Europe (and within the UK) fairly often. I'd hate to move over there and have lots of 'gotchas'


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## brian2012 (Jan 15, 2012)

jclh said:


> I'm just concerned... I want to be able to support my family of 4 on my single income and have some disposable left over to be able to travel to mainland Europe (and within the UK) fairly often. I'd hate to move over there and have lots of 'gotchas'


Yes! I couldn't tell you how much your bills would be, but for myself and my partner in Bristol (medium sized city in the southwest) our bills are:

Council Tax: £135
Gas/Electric (joint bill): £80
Water: £41
Car Insurance: £41
Phone: £30 x 2
Broadband (cable): £25
Rent: £650 (this is for a two bed in a reasonably nice area in Bristol, check Rightmove for prices for where you want to be
Home Insurance: £5.24

I can't give you an idea of grocery prices as we eat kinda funky, but I'm sure someone else could chip in.

If you want cheap flights out of the UK, Skyscanner is really good, and your budget airlines are Ryanair and Easyjet. Also Groupon do some incredible deals for flights and accomodation packages. If you want to eat out reasonably cheaply in the UK, get a Taste card, will get you 50% off food in loads of places. Ditto the Gourmet Society.

Hopefully some of this will give you an idea of your costs and options.


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## nyclon (Apr 3, 2011)

jclh said:


> Wow! Thanks everyone... great replies!
> 
> 
> 
> ...


You biggest expense by far is going to be rent and there is no sugar coating it, rents in London are expensive.


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## jclh (Mar 9, 2013)

I must say I'm very impressed with this forum! You guys have given lots of useful information and have been very polite! Many forums I've been on are not that way...



> You biggest expense by far is going to be rent and there is no sugar coating it, rents in London are expensive


I've checked out zoopla for rents in London... and it seems 2 bed flats go from 1700 to 1900(pounds... I don't know where the pound key is on my keyboard yet  )/mo... this is taking into account though that we have not visited the areas and seen for ourselves if they would be appropriate for kids...

Right now in the US we are paying about $1300/mo for a 2 bed. So as a rule of thumb, it seems I'll be somewhat close if I can make roughly the same number in pounds as I do in dollars here, it will be in the ballpark. My biggest concern was taxes though as I didn't know what % would come out...

Been to grocery store websites and it seems (very roughly) what costs $1 here costs about a pound there...

I'm just trying to see if my theory will hold water 

Thanks again!


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## Joppa (Sep 7, 2009)

For a long time, a handy rule of thumb for travellers and relocators have been: one dollar equals one pound. This is in fact a pretty good yardstick, but clearly it's a rough-and-ready one, as exact comparisons vary greatly from area to area, and it's difficult to get the exact like for like between the two countries. As sterling is weak at the moment (just dropped to below $1.50 for the first time in several years), your dollar may go further in UK now, but things can change just as quickly and unpredictably.

Thing about London is the difference between top rent (in most fashionable areas like Mayfair, Belgravia and Chelsea etc) and bottom rent (in least desirable areas) can be enormous. I know the same can be said about Upper East Side vs South Bronx in NYC, but the difference here is there is no no-go area as such in London and people can and do live in all areas. It's usually a matter of choice, and making compromises based on priorities.


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## jclh (Mar 9, 2013)

Another question...

I'm searching on job search sites and I'm seeing 2 different pay structures...

Some jobs list an amount per anum (i'm assuming these are permanent salaried jobs)

Some jobs list an amount per day (I'm assuming these are contract positions)

My question is, for the per day jobs - if I add them up assuming 5 days per week/4 weeks per month are wildly higher than the salaried jobs... double and sometimes even triple for the same type of jobs... that just doesn't seem right unless my assumptions are wrong...

I know that the 20 day per month figure isn't exactly correct, but that wouldn't account for such a big difference...

Or would it be something else... I.E. contract jobs have to pay way more taxes or something to that effect?

Thanks again for everyone's help!


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## Joppa (Sep 7, 2009)

What it usually means is permanent position pays you certain amount over a year, but contract job only pays for the duration of your contract. Even if they pay you £100 a day, it's not much good if the contract finished in a month and is not renewed.


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## jclh (Mar 9, 2013)

Ok, thanks Joppa... 

My first question to prospective employers would then have to be, will the contract renew after the initial period... and under what conditions would it *not* renew.

Thanks again.


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## brian2012 (Jan 15, 2012)

Contracting pays way higher because rather than employing someone permanently, a company just want someone to come in, do a job, and be gone once there's no use for them. This means the pay is much higher, but you can be released with a day's notice (though if you have a contract for a month and they release you the next day, they still have to pay you for the month, as I understand it). You also have to do all your own taxes, don't get paid for holidays or sick days, and likely won't get any benifits, but you can sign on with an umbrella company (I've heard great things about Giant Strongbox) who will do all your taxes and put money aside for holiday periods for you so have a steady income while working. Many will even help you secure jobs.


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