Tax Problem

Kazelle4711

Hi there, first time poster.
I've got a few issues and can't get any straight answers or advice.

I earn 12,500 before tax
I receive £70 per month, before tax, for monthly car allowance
i receive 37p per mile.

Question 1) my tax code last year was 647L, this year is 657L. I understand, that i have had the amount deducted due to the car allowance, but this was taxed at source last year. The odd bit is i'm still taxed on it a second time, through my pay. I've asked payroll and they said thats right. But i'm being taxed twice - is this correct?

Question 2) I only drive around 1,500 miles per year, and get 37p per mile, which it also appears i've been taxed on. - Is this correct?

I explained to my payroll dept, if i dont put mileage in i get a set amount deducted, yet if i put mileage in theres a difference - which means something more is being taken out ! I didn't think you had to pay tax up to 40p per mile?

I don't know who to contact (if i'm in the right), as work keeps saying, thats how it is and 'thats that' !, and i can't get through to the HMRC.

Anyone know if any of this is right, or a website i can look this up (i really don't understand any thing on HMRC).

Mikeyorks

I'm not really following this .... in particular where you consider you're paying additional tax.

As Code 647L is the basic Code most of us have ...... Code 657L is 'better' - not worse, as you appear to imply. As it gives you £100 extra allowance ....... ergo less tax to pay.

Kazelle4711

Sorry i have no idea how i managed to write that.
With putting the wages and car allowence i then went and put the wrong code.

The real tax code is 543L

My head is everywhere with not knowing whats going on. Thanks

fengirl_2

First of all, the 37p pm is not taxable and your payroll dept should not be taxing it. That is clear. You can also claim tax relief on the extra 3p pm which allowed under tax law from HMRC.
Secondly, if the £70 allowance is being included with your wages and taxed, then you should not have a restriction in your code number as well. You need to ring your tax office and tell them that the £70 is included with pay and taxed at source. They may want confirmation of this from your employer.