Been on K code, taxed on ALL earnings for 3 years!

fuziluv

I feel like a prize idiot but i've never understood tax codes etc but we had avisit from a financisl advisor this week who asked why my payslip said im on a K code. She advised I query it as I have never had any kind of benefit and I called the helpline, turns out i've been on a K code since 3rd August 2006.

Was told it is an error on their part, no idea why I had ever been changed! As it is their error he immediately changed my code to the correct one and said I dont need to send any documents in but the service dept will deal with it and send a refund cheque. I said any idea how much and he said a substantial amount.

Has anyone ever had this? Know how long it will take or how much i'm likely to get back?

Tarasam

Lokolo wrote: »

K code means "we are waiting for some evidence" or "there is something different about you" on those lines, so whilst they are trying to sort it out, they put you on K tax code.

Obviously it was never rectified so still stood.

However, thats a nice summer bonus you're getting

I suspect you will get your personal allowance back, if you only had one job. So £6,035, plus £5,225, plus whatever your allowance was left on 06/07/

Sorry but this is wrong, did you previously have a company benefit from an employer, eg a company car. Normally this is why you would have a K code, or its sopmetimes down to receiving a state benefit like pension or incapacity benefit.

If you post your P60 figs, we'll calc it for you but you WILL NOT get back your personal allowances that is def incorrect.

Lokolo

kellyshay wrote: »

Sorry but this is wrong, did you previously have a company benefit from an employer, eg a company car. Normally this is why you would have a K code, or its sopmetimes down to receiving a state benefit like pension or incapacity benefit.

If you post your P60 figs, we'll calc it for you but you WILL NOT get back your personal allowances that is def incorrect.

OPPSSSSSSSS.

T... K... :rotfl:

trevormax

fuziluv wrote: »

I feel like a prize idiot but i've never understood tax codes etc but we had avisit from a financisl advisor this week who asked why my payslip said im on a K code. She advised I query it as I have never had any kind of benefit and I called the helpline, turns out i've been on a K code since 3rd August 2006.

Was told it is an error on their part, no idea why I had ever been changed! As it is their error he immediately changed my code to the correct one and said I dont need to send any documents in but the service dept will deal with it and send a refund cheque. I said any idea how much and he said a substantial amount.

Has anyone ever had this? Know how long it will take or how much i'm likely to get back?

You may have been on a K code due to an underpayment of taxes being coded into your personal allowance on the 06/07 tax year for a previous year, but then they should have been able to tell you this as its quite easy for them to spot.

Indeed, you seem to be looking at quite a nice rebate going into the thousands.

For instance, looking at just 07/08 and 08/09, if you were a basic rate taxpayer for
both years and the K code was a very small code and you should have been on a standard tax code for both years, you would be looking at a bit under £2.4k.

If you had a high K code or if you were a higher rate tax payer, it would be even more.

As Kelly says, you will not get your PA transferred to this year, you will just get the overpaid tax back. If you are happy to do so, you can post your P60 figs up and we can work out the overpayment amount.

fuziluv

Thanks. I can't put my hands on the figures for 06/07 (in loft) but for 07/08 the K Code was K868 (on the latest coding notice I have for that year). During this year I did have a Company car which is listed on my coding notice but they also have me down for State Pension of £6880! During that year I actually earned £8193.30 but was taxed £1801.69.

Any thoughts?

Any

fuziluv wrote: »

Thanks. I can't put my hands on the figures for 06/07 (in loft) but for 07/08 the K Code was K868 (on the latest coding notice I have for that year). During this year I did have a Company car which is listed on my coding notice but they also have me down for State Pension of £6880! During that year I actually earned £8193.30 but was taxed £1801.69.

Any thoughts?

You've earned this in total?
And does the coding notice say how much was the company car benefit worth?

basicaly add your total earnings for that year (the best place to find that is P60) & add the benefit worth for company car.

Deduct your personal allowance of £5225.

The rest is taxable:

£2230 at 10%
Rest at 22%

= tax you should have paid. Everything you overpaid you will get back.

System

fuziluv wrote: »

Thanks. I can't put my hands on the figures for 06/07 (in loft) but for 07/08 the K Code was K868 (on the latest coding notice I have for that year). During this year I did have a Company car which is listed on my coding notice but they also have me down for State Pension of £6880! During that year I actually earned £8193.30 but was taxed £1801.69.

Any thoughts?

The state pension is taxable income but cannot be taxed at source so the only way to ensure the tax that is due on it is collected is to include it as a deduction on the code applied to your main PAYE income source.

It sounds as though your K code is due to both your company car and the state pension but can I just ask if you are over 65? If so then you could also have been entitled to your higher age allowance. However HMRC generally do not allocate that to you until you have completed a P161 pension enquiry form. One is usually sent out to you in the year you turn 65. The reason for this is because the higher age allowance is means tested and so you may not be entitled to all of it.

fuziluv

Pam17 wrote: »

The state pension is taxable income but cannot be taxed at source so the only way to ensure the tax that is due on it is collected is to include it as a deduction on the code applied to your main PAYE income source.

It sounds as though your K code is due to both your company car and the state pension but can I just ask if you are over 65? If so then you could also have been entitled to your higher age allowance. However HMRC generally do not allocate that to you until you have completed a P161 pension enquiry form. One is usually sent out to you in the year you turn 65. The reason for this is because the higher age allowance is means tested and so you may not be entitled to all of it.

No, I am not over 65, I am 29! When I called they said there was no issue with my company car benefit, which I only had for a few months, but at the time that these details were added to my details, an error was made and I was put down as having a state pension, incorrectly! They even asked if i've ever claimed any other benefit such as windows benefit, which I haven't!

Just wish they would let me know what happening!

Any

fuziluv wrote: »

No, I am not over 65, I am 29! When I called they said there was no issue with my company car benefit, which I only had for a few months, but at the time that these details were added to my details, an error was made and I was put down as having a state pension, incorrectly! They even asked if i've ever claimed any other benefit such as windows benefit, which I haven't!

Just wish they would let me know what happening!

Well, firstly they need to change your tax code immediately to at least make sure that you are being taxed correctly from now on. That doesn't take that long to work out for them.

So give them a ring and ask them whether they sent out new tax coding notice for you - then check your next payslip that your employer also changed it. What you overpaid this tax year so far will be given back to you during the next few months of this tax year (once they change the code).

Also ask them on update on the previous years and whether they need anything from you (copies of P60s, P11Ds or anything - they should have it all but they might ask you as a cross reference), basicaly just make sure they are dealing with it and they have all the notes on the system (sometimes you speak to one person, nothing happens and then when you call again you find that the first person didn't leave notes..)