Salary Paid for no Work

skyjumper

I left my full time job in July to start working for mysef. Self- employed currently. But in the end of August they paid me as if I was still working with them. I notified the pay dept and they told me it was a mistake from their part as they haven't taken my name out of the pay system. they also informed me that it won't happen again and what they paid will be taken out of my account shortly.

Now I would like to know

1. How long would they take to do this. Nothing has happened in Sept and I have kept this amount in excess in my current account - scared to put it in a high interest saving account as not sure when they would take it back- i dont want to go into credit in my current account

2. how is this pay going to affect my self-employed tax - i mean they have paid me the salary taking out the tax and i guess this was paid to the HMRC under my NI number or something. so what happens when they take the salery back. will they have to reclaim the tax paid- i may be worrying about nothing major, but just want to see what people think here at MSE

thanks for your time

LittleVoice

Though they should have paid tax and NI over to HMRC they will not have recorded it at that time as being in relation to your pay. They only notify HMRC person specific details at the year end or on a P45.

So if they do get the money back from your account via the banking system, then they should be able to sort things out when they issue your P45 and when they do their end of year returns next year.

However, they seem to have left it too long to get a refund through the banking system - I think you have to recall a BACS payment very quickly and not a few weeks later. I think they should ask you for a cheque to re-pay them.

You do need a P45, so contact them about that.

anniecave

Phone them up to remind them as I would think it should be a manual process not an automatic one hence they really should have done it by now!

They will just reverse the tax and NI etc that they took off you when they paid you by mistake so you'll be back in the same position as you were before.

skyjumper

thanks for the speedy reply LittleVoice and Anniecave.

What I'm scared is - if they ask me to pay any interest for the time I kept the money- can they really do something like that ? may be i'm being too paranoid, but I have contacted them couple of times through telephone and emails and they have assured the money will be taken 'shortly'. Do you think I should write to them instead, threatening( just kidding) to take their money back?

LittleVoice

No - they definitely can't try charging you for their mistake!!

Do not worry about that.

Write to them about your P45. Ask them what figures they are going to put on that.

Mikeyorks

skyjumper wrote: »

Do you think I should write to them instead, threatening( just kidding) to take their money back?

They can't do a BACS recall after this amount of time - they now have to write to you requesting the overpayment be returned.

And post #2 is also spot on as regards the tax / NI paid to HMRC. Yours is simply part of a lump sum they pay over monthly - so they simply reduce the payment in the month they eventually get off their bums and ask you for the net wages back. The PAYE / NI / SLC etc only becomes allocated to you specifically after 5.4.09 when they put the necessary detail into HMRC.

skyjumper

thanks guys for the replies.

talk of the Devil and ............

got a letter from the Payroll today asking for repaying the money owed back to them beofre 30th Oct. just the amount in my Pyaslip. no interest,
thanks guys for the support