Nil Tax Codes.

DEBT_23

am i right in thinking EVERYONE gets a nil tax code for the rest of the year from being made BR ?
is there anyway of getting out of the nil tax code?
Im saying this
as my HR will query or dig into why im paying no tax... could then lead to possible no income due to the ending my employment!?
If they think i have enough disposable income for a IPA will they still put my in a nil tax code??
Id really prefer that they didnt.. this is the only way my work will know im BR if they do
will lose my wage then cannot pay anything.

ajbisgr8

I've not heard of anyone being given a nil tax code just cause they are bankrupt but it's not my area of expertise. Don't worry aboutyour work fuinding out - HMRC cannot disclose information about how your tax code has been calculated - only the code itself.

kpp2002

Hi DEBT_23

I went BR on jan 24th and never got a NIl tax code, I think it depends on both the OR and the time of year. I dont think HMRC give it a paticuary high priorty, My OR said it was "hit and miss" whether they applied them..

Unless specifcally (and by that I mean contractually) you are banned from going BR in your job your will not get sacked. If you do consult your union (if you have one)

Your HR will not know you are BR, if you do feel the need to justify it to them then just say you hav been paying too many tax for yrs in a previous job so now they are refunding it. they will never know

Good luck and dont stress!

LilacPixie

Don't stress. even if you do get a nil code most payroll departments wouldn't bat an eyelid. There are tonnes of other reasons why you could have a nil code, a previous erronous tax rebate, benefits in kind, due HMRC money from being on the wrong code, using your full personal allowance elsewhere such as savings of a private pension or 2nd job etc etc. nil or br tax codes are so common that i really doubt they would notice.

Also HMRC instuct an employer to use a specific tax code and it really has noting to do with and employer as to why they want a specific code used.

fermi

ajbisgr8 wrote: »

I've not heard of anyone being given a nil tax code just cause they are bankrupt but it's not my area of expertise.

It should normally happen for the remainder of the tax year, assuming that you haven't changed jobs soon after the bankruptcy.

It can take a while for them to apply it though.

”NT” tax code Income Payments Agreements and Income Payment Orders

When a bankruptcy order is made against an individual who is subject to PAYE, HM Revenue and Customs (HMRC) applies a “nil tax” code to that person for the remainder of the tax year in which they were declared bankrupt and can then claim in the bankruptcy for the amount of tax which would have been collected (plus any other money owed for previous years), as long as the debtor does not change his/her source of income (i.e. gets a new job) during the tax year in which the bankruptcy order was made.

Where the new tax code is expected to be applied before the end of the tax year an IPA/IPO should be obtained. Where the bankrupt has signed the Tax and NI Disclosure Authority, an Income Payments Agreement (IPA) should be sought in preference to an Income Payments Order (IPO), to claim the extra money that the debtor receives.

An IPA/IPO can be made purely on NT tax code grounds and is not dependent on whether the debtor has any disposable income to make regular payments.

diablobear

Hiya Debt 23 please don't worry too much about the NT tax code.
When HMRC advise an employer to change a tax code it does not say why, just what the tax code is and when to apply it.
A payroll department should not ask the employee why. It is none of their business they are there to process the paperwork and file it.
A payroll department can guess and only guess if it's due to BR as said before there are plenty of other reasons why this code is issued. If you are asked about it either thank them for bringing it to your attention and you will look into and leave at that or if pressed about it you could say "If that's what HMRC say my tax code is then who am I to argue."
Believe me payroll departments see a lot worse than a NT tax code such as Attachment of Earnings and being asked to fill out forms for suspected benefit fraud, in all of these cases they just need to process the paperwork not gossip or pull up the employee about it.
HTH

DEBT_23

i had a A of E last year council tax . from 2 years ago.
up to date this year

Dez-Titute

Hi All,
I am on a NT and have received notification as such and that all tax collected to date will be reclaimed by the OR.

My question is now that tax is no longer being deducted at source the equivalent amount of tax that would have been deducted needs to be paid towards the IPA.
1)As earnings vary how or who calculates the amount due?

2)How is this paid and when?

Cheers DEz