P60 Clarification Please

Pont

I've just received my 2009/10 P60.

I would be very grateful if anyone can state if the below is correct, and perhaps point me in the right direction to find how HMRC deal with this.

I'm an essential car user, I have to use my own car for work purposes. I pay for the petrol myself then log all of my business miles which are then reimbursed to me by my employer at a rate of 34ppm. This reimbursement is paid via my salary but is not subject to tax/NI/SL etc.

My P60, received today, shows my petrol reimbursements lumped in with my salary. Therefore my P60 reads as if my earnings were approximately £3000 more than they actually were.

As I have to provide my P60 when applying for a student grant for my daughter, the result will be that she will receive less than she is due. For example, my actual salary was £25 000, but my P60 is showing £28 000 (which includes £3 000 petrol reimbursement).

Any help and(or) advice out there?

fengirl_2

The only people who can resolve this are your employers. Once HMRC checks this pay against tax deducted, you will finish up with an underpayment of tax. You need to point out that they have included non-taxable payments on your P60 which needs to be amended.

Pont

Thanks fengirl - I was hoping you would drop in!
My employers were instructed to sort this out by HMRC over 2 years ago but they continue to get it wrong! Are my employers legally bound to sort this out? Are you aware of any document from HMRC that states this simply so I can show them evidence of yet another mistake? This has now been going on for 7 years - I am slowly losing the will to live!
Just re-read your post. I have made an overpayment of tax, NI and SL as initially my employer made deductions from my reimbursement incorrecty - the reimbursements are tax/NI/SL exempt (this thankfully has now been sorted out by HMRC).

fengirl_2

Well, your employers are legally bound to make correct returns of salaries and tax deducted to HMRC. Its all in the employer's instructions issued by HMRC. An inaccurate P60 (or any other document) is of no use to anyone - that should be self-evident.
Here is a link to the HMRC instructions on dispensations which applies in this case:
http://www.hmrc.gov.uk/paye/exb/schemes/dispensation.htm
Basically, it says that you can pay your employees up to 40pm for work travel and not have to report this to HMRC.
You realise you can claim the additional 6p pm from your tax office?

dori2o

fengirl wrote: »

Well, your employers are legally bound to make correct returns of salaries and tax deducted to HMRC. Its all in the employer's instructions issued by HMRC. An inaccurate P60 (or any other document) is of no use to anyone - that should be self-evident.
Here is a link to the HMRC instructions on dispensations which applies in this case:
http://www.hmrc.gov.uk/paye/exb/schemes/dispensation.htm
Basically, it says that you can pay your employees up to 40pm for work travel and not have to report this to HMRC.
You realise you can claim the additional 6p pm from your tax office?

You can claim tax relief on the extra 6 per per mile.

This is one of the common calls we receive at HMRC,people think they will get back the 6p or 30p or whatever it is from HMRC, but all they do is give you the tax back on this amount.

So for every 6p, you would receive 1.2p back. Still, it's better in your pocket than not.

Pont

Thanks both.
Yes , I'm currently claiming tax relief on the difference between my reimbursement and the 40ppm allowed by HMRC. Not a lot, but as you say, better in my pocket!
However, the problem is occuring because my P60 is recording in the 'Pay and Income Tax details' £28000 and not £25000 which was my actual wages (£3000 was reimbursement of petrol I'd paid on behalf of my employer and then claimed back from them). This £3000 was not pay.
As I mentioned, this is causing a knock-on effect when it comes to applying for my daughter's student grant. They are looking at my P60 and determining that I earned £28000 - this is not the case.
Help!

malkkky

I think you may have another issue here as well - if the £3k mileage reimbursement is showing on your P60 as taxable earnings, that suggests that your employer has deducted tax on it.

Pont

malkkky wrote: »

I think you may have another issue here as well - if the £3k mileage reimbursement is showing on your P60 as taxable earnings, that suggests that your employer has deducted tax on it.

Yes, they had originally. But now, due to me going to HMRC and confirmed this was incorrect, my employer has agreed this was wrong and have since stopped taxing my reimbursement in my monthly salary. Nonetheless, they have failed to correct the mistake on my P60.

Ever feel like banging your head against a brick wall? I'm sure there must be a document/information out there somewhere that I can forward onto them.

Pont

Hi jimmo - thanks for your post. You've grasped the problem exactly, despite my ramblings!

HMRC wrote to my employer (Yes - Local Authority) two years ago and instructed them to sort out this mess and to pay me (us) correctly or HMRC would sort it out. My employer stated to HMRC that they would 'put in new and correct measures from April 2009' and also recalculate all of the previous years overpayments of tax/NI/SL. This didn't happen until October 2009 for the 2009/10 tax year, and they've now said they will not look at earlier years!

The unions have been aware of this for 2 years but have done little to sort this out. The unions seem to accept the old line of, 'We're having a meeting about this next month etc. etc.' but of course the 'meeting' never goes ahead!

I've referred all of this back to HMRC as it's quite clear my employer hasn't done what HMRC instructed them to do 2 years ago. To compound the problem I've been told that HMRC is likely to slap an almighty fine on my employer - that's going to make me popular at work!

Altogether, these mistakes add up to me overpaying deductions to a sum of several thousand pounds over 7 years. I'm sure this will eventually get sorted but in the meantime my employer's mistakes are costing my daughter - that's what totally p%$£*s me off at present.

fengirl_2

Raise a grievance agsint your employer?

Pont

fengirl wrote: »

Raise a grievance agsint your employer?

I think I may have to! This certainly won't help my job prospects - but then I'm Local Government so I'll probably be out of a job soon anyway! It's total madness that a County Council gets it so wrong, I shudder to think what c£$%k-ups are going on in other departments!