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  • FIRST POST
    • edinladen
    • By edinladen 26th Nov 17, 6:40 PM
    • 2Posts
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    edinladen
    Switching Tax Codes
    • #1
    • 26th Nov 17, 6:40 PM
    Switching Tax Codes 26th Nov 17 at 6:40 PM
    Greetings!

    I got my first ever job this month (8th of November) and when I received my payslip, it says 0T and Tax Basis is Non-Cumulative. I was reading the difference between Non-Cumulative and Cumulative and I thought it would be better to switch to Cumulative and probably get the £11,500 annual allowance.

    My question is, is it possible to call HMRC and ask them to change my tax code/basis? Second, will they allow it if ever?

    Hope someone can answer my questions.

    Cheers!
Page 1
    • Dazed and confused
    • By Dazed and confused 26th Nov 17, 6:46 PM
    • 1,968 Posts
    • 884 Thanks
    Dazed and confused
    • #2
    • 26th Nov 17, 6:46 PM
    • #2
    • 26th Nov 17, 6:46 PM
    Your employer should sort out your tax code in this situation.

    You need to ask them (your employer) for a new starter form/declaration. Once you have filled this in then they, not HMRC, allocate a tax code based on your declaration.

    If you and your employer do this correctly then you should get a cumulative tax code of 1150L for this year. By end of December you could have earned £8625 without needing to pay tax (rising to £11500 by 5 April 2018).

    Any excessive tax already deducted will be refunded by your employer when they first use the correct cumulative tax code.
    • edinladen
    • By edinladen 28th Nov 17, 11:25 PM
    • 2 Posts
    • 0 Thanks
    edinladen
    • #3
    • 28th Nov 17, 11:25 PM
    • #3
    • 28th Nov 17, 11:25 PM
    Thank you for your response. How soon can the refund come? Is it going to be from the company or HMRC?

    Thanks again! Cheers!
    • 00ec25
    • By 00ec25 28th Nov 17, 11:57 PM
    • 5,566 Posts
    • 4,971 Thanks
    00ec25
    • #4
    • 28th Nov 17, 11:57 PM
    • #4
    • 28th Nov 17, 11:57 PM
    Thank you for your response. How soon can the refund come? Is it going to be from the company or HMRC?

    Thanks again! Cheers!
    Originally posted by edinladen
    essentially your refund will come as part of the first pay you get using your new tax code. In other words that pay will have less tax deducted from it than it would otherwise have because the new (correct) code is playing "catch up" for the period between April - date and so you get all your missing tax free amount delivered as a lump sum in the next payrun. .


    simple example:
    next payrun is Dec. That is month 9 of the tax year so you would get 11,500 x 9/12 (£8,625) of your tax free allowance by that date.

    tax works on a cumulative to date basis so in Dec your cumulative gross pay to date will be Nov + Dec. Deduct 8,625 from that, and if it is a negative number, you will get a refund of any tax you paid in Nov as part of the Dec payslip and you won't pay any more tax until such time as that figure becomes positive, which of course depends on how much you earn each month, but could mean you'll get at least 1 - 2 months where you won't pay any income tax


    national insurance is different, you will not get a refund of that at all, and you will pay some each month going forwards assuming you earn more that about £680 per month gross
    • badmemory
    • By badmemory 29th Nov 17, 3:00 AM
    • 1,060 Posts
    • 1,122 Thanks
    badmemory
    • #5
    • 29th Nov 17, 3:00 AM
    • #5
    • 29th Nov 17, 3:00 AM
    Just look out for your new tax code, until you get that nothing will change. so keep your eye on the ball.
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