Personal Finance on James Jarvis

💰 My UK Tax Burden in 2025: A Personal Finance Reality Check

hello@jamesjarvis.io (James Jarvis) — Sun, 24 Aug 2025 00:00:00 +0000

The Reality of UK Taxation in 2025 💰

It’s a strange hobby to have - budgeting - but it’s something I quite enjoy framing as an optimisation problem.

Recently there’s been quite a bit of chat about the burden of taxation in the UK, with several fiscal “black holes” being discovered by the government, attempting to be closed via higher taxation, and then somehow doubling in size the next year.

This is not going to be a specific opinion piece on taxation, but I wanted to provide some insight into what a typical PAYE employee as a Software Engineer in London may expect to pay in taxes in the UK.

My Personal Tax Breakdown

Let me start by being completely transparent about my tax situation in 2025. I’m not going to share exact figures, but I will share the percentages and structure that make up my total tax burden.

For the purposes of this breakdown, I am sampling an average month of the year, and counting “income” as any money that I am given by my employer in exchange for my labour. I’m not including an outlier month (like paying Stamp Duty or a Capital Gains tax )

This particular month is representative of the last year I’ve been living in my house, where I’ve reduced my “lifestyle” spend quite a lot, and have been dumping money into my recent house purchase. You’ll recognise there’s no “buffer/savings” section at the moment, 🤞 in a couple months I can swap the “renovation” section with “savings”, and I’ll probably post an update in a couple years, but the taxation breakdown will likely remain the same.

Income

Full time Employment, fairly standard
- Including employer’s pension contributions

Expenses

Tax (43%)
- National Insurance (12%)
  - Note: This includes Employers National Insurance, because ultimately I pay for this.
- Income (25%)
- Consumption/VAT (4%)
- Council (2%)
Savings/Investments (21%)
- Pension
Housing (20%)
- Mortgage Interest (15%)
- Mortgage Capital Repayments (5%)
Lifestyle (13%)
- Eating Out/Groceries
- House Renovation
- This section has been tight for a while now, and will increase after House Renovation (~10%) has finished.
Bills (2%)
- Gas/Electricity/Phone/Wifi
Transport (1%)
- TfL

The Tax Reality

The taxes I’ve included in this are:

National Insurance Contributions
Employers National Insurance Contribution
Income Tax
Council Tax
VAT
Insurance Premium Tax
Capital Gains Tax (currently negligible from my amounts)

I haven’t included:

Import tariffs
Road Tax
Any other erroneous tax on specific items that I didn’t want to calculate

Total Tax Burden as an individual: ~43% Total Cost of Living: ~67%

I’m not going to get too political, but if you assume my situation is fairly standard, and you assume that an economy is just the sum of its population, then it looks an awful lot like the UK economy is 43% government, about 30% housing, and around 3% the stuff you actually see and do.

What if I were a business?

There are some tax benefits that for some reason are only available to corporations, so I thought - what if I was a corporation?

Disclaimer: I’m not an accountant, and this is a bit of a stretched example relying mainly on the fact that expenses can be tax deductible, and completely ignoring the impact of import taxes, sales taxes, employment taxes, private health insurance etc that would be incurred.

But the general idea of it is, if an expense is vital for a company, it should be deducted from the tax liability of that company. Whereas if an expense is vital for a person, it cannot be tax deductible.

Interestingly, you could arguably question whether an employee’s income tax should ultimately just fall as a consumption tax on human capital for a corporation (i.e. Employers NI), but as the incentive should be to have companies employing people, I think this is hard to justify.

Tax burdens as a corporation: ~13% Total Cost of Existence: ~36%

Looking Forward

At the time of writing, the UK is preparing itself for a further round of tax increases in the UK (as opposed to cutting spending, reforming blockers to economic growth, or accruing further debt).

Nobody knows quite what the expected tax increases will be, but they are generally expected to tip into the “too much” category, risking some civil unrest.

Most people in the UK have absolutely no idea how much tax they are spending, or the inequality of taxation for an individual compared to a corporation - especially not to the extend that an individual with a certain level of wealth can engineers themselves into being taxed as a corporation, hence avoiding a 43% tax burden and decreasing their proportional cost of existence.

I am personally hoping for (though not expecting):

Simplification of the tax system + reducing regulatory barriers to growth
- See: UK Foundations Whitepaper outlines several blockers.
Better public understanding of the true cost of government
- Even better, a reduction in wasteful or too-generous public spending
Policies that address wealth inequality and social mobility
- See: Fairer Share as one potential tax change targeting “council tax” reform.

But my concern is that we’ll see more of the same: hidden tax increases, blissful ignorance of state inefficiencies, corporate tax cuts, and a growing burden on the average worker.

What’s your experience with taxation? Is it fairer/worse in your country? I’d love to hear your thoughts on the current system and what changes you’d like to see. Better yet, message your representative politicians.

🏡 On Buying a House

hello@jamesjarvis.io (James Jarvis) — Wed, 02 Oct 2024 00:00:00 +0000

I have a bit of a confession to make.

I am horribly, frustratingly, embarrassingly… indecisive.

It took me 4 months to decide on a new bike earlier this year, when I desperately needed one to commute.
It took me 3 months the year before that to decide on a new coat for the winter, when I had no waterproofs at all.
It took me over a month to decide on a replacement car when mine was crashed in to, and I was out of my most useful mode of transport.

But these were comparatively small purchases. What if I were to continue acting the same, but apply this to the largest financial decision of my entire life?

So, we arrive at March 2024. The beginning of my search.

Why buy?

For context, I have been living primarily in East London (Wapping/Limehouse) for the last 4 years, in flats of varying quality.

The rent was roughly ~2kGBP/month, split between myself and my housemates - not all too bad considering I could cycle into work/around London, and that is something I thoroughly enjoyed doing.

But there was always the sense of impermanence to the rental situation. Like my housemates, I had never decorated my room, too afraid to knock anything into the walls, or risk losing our deposit. I “made do” with furniture/appliances/colours/bathrooms I didn’t like, because I couldn’t get rid of the existing stuff, and I wasn’t allowed to change something that wasn’t mine.

Cynically, I was starting to assume that landlords fill flats with the cheapest ikea furniture, not because it was cheap for them, but because it would eventually break, and clawing back deposits was another stream of income for them.

Honestly, I was exhausted of not feeling safe enough to make my place of residence, my home.

Settled: I’ll buy my own place! (After years of aggressively saving for a deposit).

What buy?

It all depends on your lifestyle and your budget really, and there is no good guide for this. But I would recommend you take stock of what you do / what you plan to do during a normal week now and in 5 years, and optimise for that.

You basically have a choice of:

	High Budget	Low Budget
Very sociable	House/Flat inside city	Flat inside city
Less sociable	House outside city	House/Flat outside city

Whatever you buy though, watch out for the following:

Transportation links
Floor plan (in flats this is pretty much fixed forever)
Service charge and ground rent charges, also check for a sinking fund
If it’s a flat, does it have an EWS1 certificate?
Avoid leasehold as much as possible

My personal preferences leant me towards having full ownership of control over wherever I was am living, so flats were out of the question. Terraced, semi, or detached are where I’m looking for, I want some physical ground I can build a shed on, or park a car.

Where buy?

I’ll preface this by saying: I love London.

I’m also from London, the South East.

Now, the South East of London has without a doubt got the worst transport options out of all of London.

The city planners somehow forgot about the South when building out the underground network, and the government was quite happy with selling the national rail network to private companies, with no incentive for improvement.

However, my family all live in South East London, and it’s almost affordable, so that’s that.

One day, I’ll move to some nice leafy suburb in the North West, but that goal is not achievable just yet…

Overview of Bexley, by CrystalRoof. Sounds about right

Useful Resources for Finding a Property

These are some fantastic resources I used to determine my ideal area, and to track down a house on the market:

CrystalRoof
- Offers insight into local crime reports, demographics, transport links, and amenities. Really helpful if you aren’t sure about an area!
HoodMaps
- Hilarious and vaguely useful community map for rating a location.
Zoopla Travel Time
- If you don’t know where to start, but know you want to be able to commute to work by bike in less than 30 mins, this is a great tool.
Zoopla
- Probably the best home finding app.
RightMove
- The most popular home finding app.
OnTheMarket
- Also useful home finding app, covers some extra estate agents.
Jitty
- Honourable mention, has some interesting AI search features, like “period property with tall ceilings and a driveway”.

How buy?

I had been living in rental accommodation for the last few years, with some “free” months in Singapore, or staying with my parents. I’m quite frugal in general, aside from the odd splurge on flight tickets, so as a result I have managed to save approximately 30% of my income (around the same that goes to the taxman, grrr) over my first 6 years of work.

By around March 2024, this looked like a good enough amount for a bank to take me seriously as I requested a mortgage offer, and so I started to look for places.

If you have followed the writings of Gary Stevenson, the evidence of rising inequality can provide an explanation of why housing is becoming more unaffordable, but since I’m in no position to change this, it’s worth jumping in to the housing market as soon as you can.

The process is fairly simple:

Get a Mortgage in Principle (MIP). This is generally a crude affordability check for how much you can theoretically borrow from a mortgage lender. This is a maximum value, do not take it as a goal. Remember, you want to own a house, not to be owned by a bank.
Go for some viewings. Different areas, different styles, different sizes. This will take a long while (4+ months) but that’s ok. You probably won’t know what to look for but the most common, most valuable questions are:
- How old is the boiler?
- How old is the kitchen?
- How many plug sockets does the property have?
- Does the property have good insulation?
- Does the property have damp? Or any leaks?
- In what condition is the bathroom?
- Are there any signs of Asbestos?
- How are the neighbours?
Put in an offer. I would even recommend being a bit cheeky, and putting in an offer ~10% below market value for a property you won’t mind losing. You’ll get more of an idea of how the process works, and it won’t feel so daunting after the first time. Remember, you aren’t just buying a property, you are selling yourself as a good buyer, that can be extremely valuable to some people. If you are a first time buyer, you are worth at least 1% of the property value more when compared to another buyer in a long chain.
Get a good solicitor It’s not worth being cheap here. These guys are expensive, but the difference can be night and day. Go for one with good recommendations, though probably not one from the estate agents, as they normally get a kickback.
Get a mortgage Talk to mortgage brokers and go hunting online. Neither one covers the whole market, so try both for the best deal. I used these resources that I would highly recommend:
- www.mortgageadvicehub.com
- www.moneysavingexpert.com I would recommend getting a mortgage on the longest term possible (~40 years), as you will always have the ability to overpay and pay it off early, without being forced into it.
Get your surveys done You’ve got the offer accepted, a solicitor, and a mortgage offer in place. You now need have a professional come round to inspect the property and make sure everything is up to scratch. Your lender may offer a discount here if you use one of their partners, I recommend you take it, as surveys without a discount can be >£500. Your solicitor will also request environmental surveys (the surrounding area), to make sure you aren’t about to buy a future swamp. Technically your solicitor is acting on both your behalf, and on the behalf of the mortgage lender, it is in both of your interests that the house does not fall apart or get swallowed up.
Negotiate with the sellers Right before completion, you will want to negotiate with the sellers for any furniture or fittings left behind, as well as try to claw back some money for any surprises the survey may have picked up. If the house has a really cool but cumbersome cooker/pizza oven, or turns out you found the roof needs repairing, this is the point at which you want to perform a second round of negotiations.
Wait… This step is frustratingly inevitable. Any time you need to communicate with lawyers, or the Council, you lose both the will to live and a good chunk of your time. Expect the total purchase process to take ~2-6 months.
Complete! Completion day is one of those strange days in your life you’ll remember for just being a bit odd. It is the day when your solicitor gets given £100k’s from the bank, basically all of your savings, and you get the keys to your new place, all at once. If you are in a chain, this day gets even more complicated, but let’s pretend life is easy for a second and ignore that.

What next?

Grab a paintbrush, a tapemeasure, and your worst clothes. Chances are that if you found a place within your budget, as I did, you have a lot of refurbishment / renovation to do.

Even if it doesn’t need renovation, I’d recommend leaving your mark at least.

As of writing this post, I’m in this stage. All I can say for now is, make sure you budget for it!

Good luck!

📉 Inflation adjusted net worth/salary spreadsheet

hello@jamesjarvis.io (James Jarvis) — Sat, 20 Jan 2024 00:00:00 +0000

TL;DR

You can copy the following spreadsheet and play around with the data yourself: PUBLIC: Inflation adjusted personal finance

If you, like me, enjoy watching number go up graphs, then you’ve probably also got some method of tracking basic financial metrics in a spreadsheet, or via some other sort of means.

Well, we are but simple creatures, and we do like to see number go up.

The thing is, the last few years have been a bit more, shall we say, tricky than normal years. The swinging 20’s have been at it again, with the following bargain bucket of little bombs being dropped on the economy in the last 4 years:

A Global Pandemic
Climate Emergency
Russo-Ukraine War
China-Taiwan escalation
Various shipping route disruptions
AI hysteria (this one has barely begun)

Overall, this spells for an atypical combination of over-demand and supply-restriction, that has lead to fairly shocking inflation figures in much of the world.

UK Inflation Data for the last 30 years. Source: ons.gov.uk

Whilst this is not entirely random on the scale of human history, this is certainly my first experience of meaningful inflation, and it coincides just nicely with the beginning of my professional career, so I’m left feeling a bit like Harold here.

My thoughts exactly. Credit to Liz Farmer

Since I’m so unused to this, I thought I would humble myself and rebase my personal finance tracking, by inflation-adjusting all net-worth and salary data. The results were very insightful and only a little bit disheartening.

Now you can too!

The spreadsheet below allows you to calculate your own inflation adjusted data, however it is very UK focused, and I’m not entirely convinced my maths is correct, but it should be good-enough to grok whether you are on the right track or not.

Google Sheets PUBLIC: Inflation adjusted personal finance

All you need to do is copy the sheet to your own drive, and modify data under “Net Worth”. It will calculate your real-term (inflation adjusted) YoY (Year over Year) percentage growth. If you wish, you can even repurpose the data by replacing it with your salary!

This is probably slightly more depressing, as salary is sadly not cumulative.

And before you ask, no, these figures do not reflect my personal finances. I wish life were that simple.

Sources:

Office for National Statistics UK