Tax query 2 - previous employer dispute and tax confusion

mighty_rhinos

Hi again!

I'm trying to query some figures on my last employers P11D for 2006-07 and 2007-08. It all centres around a "fictional" loan for a company car and various end of year calculations. I've posted that weird set-up before so I'll leave that bit there.

I cannot locate my 2006-07 P11D and have asked my former employe to provide. I've written emails, recorded letters and phoned to specific names, job titles, etc but cannot get the document I need. Obviously my fault for losing the form, but do they have a legal obligation to send replacement?

In regards to this dispute, the kind tax office have advised me that the issue has highlighted that I underpaid tax by £1895.28 due to benefits in kind.

On a letter at end of March the tax office said my employer advised I received £266 taxable benfit in kind in 2006-07 and £2056 taxable expenses in 2007-08.

What is difference between benefit in kind, and, taxable expenses payments?

I paid for own fuel and phone calls albeit in company car and on company mobile. I claimed for hotel stays, fixed meal allowances, stationery, etc. Can they tax me on these items?

Now I;m being told I paid £428.49 on underpayemnt in 2008-09 tax year, and the remaining £1466.79 is to be collected in 2010-11. I don;t understand this and would like to keep hold of my £1466 and get back the other £428.

What can I do, where do I stand?

My previous employer won;t speak to me about anything, and tax office says I have to do all leg-work and prove the mistake, and then the employer must formally advise of the mistake. Never going to happen!

This is really stressing me out now, short of money, and feeling cheated to be honest. :mad: If I could just get straight answers and explanations from tax office and previous firm I'd probably be a lot less stressed!

Thanks for reading, wrote loads again!!

Elaine_Wilson

I'm not sure if the employer has an obligation to provide a duplicate P11D - most would certainly give you the figures anyway but it doesn't look that easy in your case.

Benefits in kind and taxable expense payments are both returned on the P11D. The BIK is exactly what it says - you received some benefit which should be taxed but it was not paid to you in cash. I presume yours is notional interest on a loan as you mention that at the beginning.

The taxable expenses payments are where you have claimed expenses from the employer. These are, in the first place, taxable since they are paid to you in cash and arise by virtue of your employment. However, you can claim a deduction for these expenses provided they comply with the rules. This claim would normally be made in the tax return but if you do not complete one then it can be done by letter.

In many cases the whole of the expenses received are allowable so there is no net liability to tax on the payments. This procedure may seem convoluted but is necessary to pass the liability for deciding deductibility from the employer to you, the employee.

In other words, assume you claim mileage for a business journey. The employer only has your word that the journey does qualify as a business journey. It would be unfair for him to be exposed to possible penalties if your claim was fraudulent. Putting it through the benefits system switches the claim to you tax return, which you sign. So now you can be penalised for fraudulent claims.

mighty_rhinos

Hi Elaine, thank you for your reply.

So, to give you further information (if you don't mind), when I had a night away in my last job I was given a flat £18 per night for dinner if out past 8:30pm. Each day I received £5 for lunch. If I had to be out overnight I got an extra £3 for phone calls, newspaper etc.

On top of this I would claim stationery, or other one-off costs.

Fuel was paid by fuel card, and then I submitted personal mileage which was dedcuted from my expenses payment on a monthly basis. My personal use of company mobile phone was accepted, I highlighted my costs from itemised bill and this too was deducted from monthly expenses too.

From your message, I think I understand that I was paid expenses and these are taxable? What would I write to the tax office to explain this, and what info would I need to back up my argument?

Thanks again

mighty_rhinos

Sorry to bump my own message back up, just keen to see if anyone can add to Elaine's message of help! Thanks