Tax code help??

ageandjo

What is this tax code??

156lm1

hilary1

156L is your tax code

m1 means your monthly salary is taxed as if that is all you have earned rather than accumulated earnings ( so you would pay tax each month depending how much you earn ofcourse)

I would not worry about the m1 as its the new tax year in April and that wont count anymore. but I suggest you ring the inland revenue with regard to your tax code code as a normal code in April will be something like 513L and unless you owe tax for some reason or you have pensions and so forth taken into account yours seems unusually low.

ageandjo

I wonder why that is then I pay roughly £430 tax a month

kscour

the first part of the code ie the number refers to the amount you earn tax free in your case 156 which equates to £1560 per year as opposed to the "norm" of 489 - £4890 tax free per year. From then on you will have the different tax bands applied.
It does seem a very low allowance which if I was employing you would lead me to guess that you either - owe tax, have a pension or something similar being paid to you, have some other source of income/job. If not ring up your tax office and ask them about your coding

isasmurf

kscour wrote:

the first part of the code ie the number refers to the amount you earn tax free in your case 156 which equates to £1560 per year as opposed to the "norm" of 489 - £4890 tax free per year.

Being the pedantic sole that I am, 156L equates to £1,565 and 489L equates to £4,895. You always put a 5 after your tax code to get your tax free allowance, unless you're a pensioner when it is then multiples of 10.

myrnahaz

Hilary1 is only partly correct - A 'Month 1' code is an emergency code (did you begin your job part-way through the year?) and you are probably paying slightly more tax than you should, so it's certainly not something you should accept or ignore as you may be due a refund. I recently worked out that one of my employees is owed £135 as a result of an uncontested Mth 1 code (and that amount has accumulated only since she started work in September), so it's certainly worth checking up on this.

The 156 part of the code is the annual allowance that you are entitled to, less a deduction for a benefit in kind (Car etc) or an underpayment from a previous year.

Don't assume that the IR will automatically sort this out in April - they may provide a more accurate code for the new year (it's also possible that they won't), but they will not automatically check whether they owe you any cash from this current year.

The easiest way to check this is to ring the Inland revenue directly (they're quite used to ordinary folk ringing them and are quite helpful). Your employer is allowed to do this on your behalf, so another option is to speak to someone in the payroll department at work. If you speak to IR yourself, they'll tell you exactly what information they need to run a check, and will even tell you how to word your written request (if needed). They'll repay you almost immediately if you can provide the right information.

sarahlouise210

It is possible that the op has 2 jobs and that the tax code has been split.........
There really isno point contacting HMRC now expecting a change in tax code as it is too late in the year. A revision is only likely if the OP works for a small employer as larger employers will have already calculated there payroll for MArch. Also the tax code will be on a month one for a reason and the time taken to obtain the missing info will mean that any new tax code would miss the deadline. Do contact HMRC after April though.. enclose P60 originals from all jobs if you have more than one. Only after April will they be able to calculate if you are due a refund.

donstermonster

sarahlouise210 wrote:

It is possible that the op has 2 jobs and that the tax code has been split.........
There really isno point contacting HMRC now expecting a change in tax code as it is too late in the year. A revision is only likely if the OP works for a small employer as larger employers will have already calculated there payroll for MArch. Also the tax code will be on a month one for a reason and the time taken to obtain the missing info will mean that any new tax code would miss the deadline. Do contact HMRC after April though.. enclose P60 originals from all jobs if you have more than one. Only after April will they be able to calculate if you are due a refund.

Great advice BUT only one point - DO contact the Inland revenue now.

I received next years tax code and a revised code for this year (saying i owed tax) last thursday
I knew it was incorrect so rang them one the Friday , they agreed to change it and i received notification today (3 working days later) that next years code has been put to a reasonable amount again and has been increased to to a better figure to make up for the wrong tax code (for 1 month) that they changed this year does all that make sense?)

SO

In short - sort it out now !
:rotfl:

myrnahaz

sarahlouise210 wrote:

It is possible that the op has 2 jobs and that the tax code has been split.........
There really isno point contacting HMRC now expecting a change in tax code as it is too late in the year. A revision is only likely if the OP works for a small employer as larger employers will have already calculated there payroll for MArch. Also the tax code will be on a month one for a reason and the time taken to obtain the missing info will mean that any new tax code would miss the deadline. Do contact HMRC after April though.. enclose P60 originals from all jobs if you have more than one. Only after April will they be able to calculate if you are due a refund.

There is no deadline - you can request a recalculation at any time. OP won't lose any overpaid tax if he/she waits a while before contacting the revenue, but the revenue will be earning interest on it in the meantime.

Month 1 code is purely an emergency code used until the individual's tax status is confirmed, but the revenue can only correct it if they are provided with the updated information. If you don't chase them, they won't change it.