533L CUMUL tax code help

waves117

Hi

i wonder if someone out there has the answer to my query.

i am single, no children, and only 1 job. my tax code is 533L CUMUL. i would have thought that if the minimun allowance you can earn before tax is £6,035 then my tax code should be 603L. i do use my car for work around 500miles a month (36p a mile), i also get a month sum for using my own car (£52 per month)

my question is why isnt my tax code 603L? and what does CUMUL refer to?

thanks you for your time

jem16

waves117 wrote: »

my question is why isnt my tax code 603L?

The amount you get for using your own car is a taxable benefit and reduces your tax code.

and what does CUMUL refer to?

It stands for Cumulative - in other words it looks at your tax picture over the whole tax year to make sure you are paying the correct amount of tax. This is what it should be.

waves117

Thanks jem16 you are a star

:j

fengirl_2

£52 x 12 = 624.
6035 - 624 = 5411 or code 541L, so I am not sure this is the explanation. Round sum car allowances are normally included in payroll and taxed with salary.
I think you need to ring your tax office and ask them how this code has been arrived at. As your employer is not paying the full car mileage allowance, you do realise you can claim the other 4p from tax?

Tiggergirl

Are there any other benefits you get with your job that you are not directly paid. Things like medical insurance etc are taxable benefits too, and the tax is collected via your tax code.

ceeforcat

Have to agree with fengirl - there must be some other explanation other that that provided by jem 16 - is the £52 taxed (it should be and also attracts NIC) Can you provide a breakdown of your code number?

kitty1801

As you are doing around 500 miles a month, your annual mileage is 6000 miles per year. You can receive the 40p per mile tax free for the first 10,000 miles so your tax free income for mileage should be 6000*0.40 = £2400.00. As your employer is only paying 36p per mile you are already getting £2160.00 tax free.

This then leaves £240.00 (£2400 - 2160) that you can receive tax free. Your employer gives you £52.00 per month (£624) tax free on top. However, as only £240.00 should really be given tax free, £384 should be classed as a taxable expense payment (TEP) and this figure used as a deduction in your tax code.

You will need to check your P11d to see how your employer has been declaring these £52/month payments. They may be showing the full £624 as TEP when in fact £240.00 of that should be claimed as an allowable expense. Your employer would need to submit a section 198 claim to the tax office along with the P11d to show that although the payment they make is £624, only £384 is a benefit. Whew!

Check with your employer to make sure they have been doing this. If they haven't, they will need to send something in to the tax office. You can also use the example calc above to work out what you think your TEP should be & call your tax office to get them to adjust your coding.