Overtime and bonuses are categorized as part of your pay and are subject to Income Tax.
How are overtime and bonuses taxed?
- Your bonus or overtime is added to your weekly/monthly pay.
- Your pay is then taxed at the basic or standard rate of tax up to your rate band, that is, 12.5% up to the first $50,000 of taxable income.
- Any pay above your rate band limit is taxed at a higher rate, that is, 28.5% on any taxable income above $50,000.