Help....my P45 is seriously wrong

db.69

Not sure where to start, easy to explain but a bit harder to put into words, so please bear with me.

I recently left my job to work elsewhere. I had been working there since the start of the tax year and received my P45....no problems so far.

I gave the P45 to my new employer (employer . I received 3 pay slips all of which showed no tax being paid, only NI contributions. I mentioned this and they said they would talk to the accountant about it.

Nothing was ever done about it and I stopped receiving payslips altogether.

Things were not working out so again I left this job and returned to my old employer, which is where I am now.

Heres where the problems are starting to occur.

I worked for them (employer for 9 weeks and was paid weekly what we had agreed upon, namely £350 per week gross. As I said before I only received a total of 3 payslips which stated that my nett pay was £381 with a deduction for NI of £30.41 and no tax deduction leaving a gross payment of £350.59.

I have now received my P45 some 3 weeks after leaving and cant quite get my head round what has been going on.

The Name, NI number, Date of leaving, tax code and wek number are all correct. However it states that my total pay to date is only £1905, which is equivalent to 5 weeks of their strange payslips. It says that I have paid no tax to date and that section for total pay and tax in this employment is blank.


I am not sure what to do next, I have spoke to them (employer 2) and they say they dont understand it and that the accountant did all the wages etc. and basically arent being much help at all.

I am worried that I will be hit with a tax bil for not paying it in the first place and that if I am I will be responsible for it. Even though it was the employers responsibility, or their accountant, to pay it for me and pay me correctly which it doesnt look like they have been doing.

does anyone know what my next steps should be or what the consequenxces will be for me in this situation.

Thanks in advance

Davy

Savvy_Sue

I would phone your local HMRC office, or the one used by your current employers, and tell them your story. It sounds as if employer 2 has failed to deal with this properly. However you've still got a copy of your original P45, so at least you can show that you have paid some tax.

Meanwhile I would ask your new employer for a P46 rather than give them your P45, that way HMRC will investigate your previous employments in this tax year and you shouldn't end up on emergency tax, although there may end up being some adjustments.

fengirl_2

I agree with Sue that you should not give this weird P45 to your new employer, but you will be on emergency code and there is no way round that. I would send the weird P45 to the tax office with copies of the payslips you received from employer B, explaining that you did query why no tax was deducted. It is likely that HMRC will hold employer B responsible for the tax they failed to deduct.

Happy_Girl_2

What is the tax code on the P45 from employer 2? And is there a 'X' or 'Y' in the M1/W1 field?

I work in this field so may be able to help you work out what it should be if you let me have the answers. And confirm that for 9 weeks your gross was £350? Can you also tell me the exact start date?

db.69

Hi,

thanks for your help everyone.

My tax code is 603L, and there is no X in the M1 W1 box, it says week 30.

It also states that my leaving date was 28/10/08 which is correct. Cant be exactly sure of my start date but think it was Thursday 28th August.

Just to make sure, I think Ive got my gross and nett pay mixed up, sorry. I was taking home £350 per week in my hand. Which should in my estimate be around £455 a week top line.

What worries me most is the payslips which show a wage of 1 hour at a rate of £381 with no PAYE Tax and £30.41 NI. Giving a total of £350.49. only have 3 of these and it is the only proof of wages that I have. The arrangment made before starting was for £350 per week take home but was only ever agreed verbally.

i do have my previous P45 as well which shows tax paid to date before starting this nightmare of a job.

Thanks again,

Davy

Happy_Girl_2

I wouldn't worry about the '1 hour' of £381. That just represents 1 unit of salary. Howver your weekly pay should look like this;

Your gross pay is £381
Your PAYE tax deduction is £53
Your NI deduction is £29
Your net pay is £299

The short answer is that imo, the payroll person in employer B has ticked a box stating no PAYE to be deducted for reasons best known to themselves!

You ARE going to have to pay this tax back, and as soon as your current employer enters the details from your P45, you tax deduction will happen in the first pay period after they do.

Personally, i would do what someone else has already recommended. Give your new employer a P46 and write to the tax office explaining what you believe has happened, enclosing copies of your payslips and P45.

HMRC MAY then adjust your tax code so you can pay back the underpayment more gradually until the end of the tax year (5/4/09)

db.69

Hi,

thanks for your help everyone.

My tax code is 603L, and there is no X in the M1 W1 box, it says week 30.

It also states that my leaving date was 28/10/08 which is correct. Cant be exactly sure of my start date but think it was Thursday 28th August.

Just to make sure, I think Ive got my gross and nett pay mixed up, sorry. I was taking home £350 per week in my hand. Which should in my estimate be around £455 a week top line.

What worries me most is the payslips which show a wage of 1 hour at a rate of £381 with no PAYE Tax and £30.41 NI. Giving a total of £350.49. only have 3 of these and it is the only proof of wages that I have. The arrangment made before starting was for £350 per week take home but was only ever agreed verbally.

i do have my previous P45 as well which shows tax paid to date before starting this nightmare of a job.

Thanks again,

Davy

db.69

Thanks Happy Girl.

Looks like Ive been wel and truly done over then eh!!

Can you tell me how much my gross pay should have been and what my weekly tax and national insurance contributions should have been to give me my £350 per week nett pay legitimately.

Dont suppose you would have any tips on how to get these payments made from the employer who made the mistake in the first place, would you???

Thanks very much.

Happy_Girl_2

For a net pay of £350, your gross should be £455
So;

Gross £455
Less PAYE £68
Less NI £37
Net £350

You won't be able to get these payments made by your old employers short of asking them to 'rollback' your salary and redo it correctly. Tbh, I can't see them agreeing to do that at your request.

Sadly, bottom line is you've benefitted from their error as your net pay has been higher due to the nil PAYE deduction so HMRC will just take the view of 'tough luck matey we want our money now'

By you writing to them and highlighting the error, it may warrant some generosity from them of amending your tax code and allowing you to effectively repay in instalments. But that isn't guaranteed I'm afraid