MSE News: Tax chaos Q&A: How to fight HMRC demands

sarahl1_2

Hi, sorry if off topic - I'm a newbie so a bit confused about where to post! But just wanted to let you know about A19 appeal success! My other half received a demand from the 2007-8 tax year, he'd been on the wrong code(according to HMRC but no way to check!). After reading about it on here I told him to try using the A19 Extra Statutory Concession and we had the letter yesterday to say they accepted his appeal and he won't have to repay c.£1700. Yay!
He's just received his new tax code so I will have him check it asap!
Just want to add - happy to pay share of tax, but like millions I suspect, until this letter, we had naively assumed that HMRC are responsible for calculating your tax code and had believed what they said - had no idea it's technically the individual's responsibility to check you are on the right code. Putting that right now!

Spursman180

It's not over....

My colleague at work had a phone session with HMRC last week and has had to pay up his demand for some £6k, during a not so polite conversation on the phone the inspector said that they expect the same situation to happen again as the 'system' has not been fixed?

Happy days ahead, I think not.

Wendall_2

Help! I am a ward Sister in a full time position within the NHS - I've worked for the same trust since 1992 and supplement my income by working shifts through the nurse 'bank' system. This is obviously a 2nd position with the NHS organisation 'NHS Professionals' for whom I have worked over 5 years.

Last ?February (2010) I recieved a painfully low monthly salary - the tax office informed me by telephone that I had underpaid tax & that they would be recouping this monthly - I was not informed how much I owed & just accepted their calculations. I have since received a letter this week stating that I owe a substantial amount of money as BOTH my employers had placed me on a tax code giving me full tax free allowances. I apparently owe in excess of 6000 GBP.

The tax office informed me yesterday that this is fault of my employers?? However having spoken with my 2nd employer today, they claim that the Tax office instructed them in April 2008 via a EDI report to change my tax code from Basic Rate to 55L CUMUL. I am no tax expert & as a PAYE employee have always trusted my employer to apply the correct rules. It now appears to me that this is a tax office blunder.

Do I have any argument with HMRC? Can I appeal this decision on the basis that it appears to be their fault?

I have read the comments from those above dissing people moaning about repaying their tax, but this is personally going to cause severe financial hardship. However my salary has gone down considerably, I am 3 months pregnant & this is causing my partner & I serious distress as I am the main wage earner in our household. As a PAYE employee I was unaware that I required additional qualifications to understand tax codes.

Any advice would be most gratefully received.

chrismac1

The first step is to post up the calculations by tax year on here. A lot of these repayment calculations are themselves blunders by HMRC. Once we're happy they have done their sums properly, we can move on to whether you can fight them for not having got their calculator buttons pressed quickly enough.

Wendall_2

chrismac1 wrote: »

The first step is to post up the calculations by tax year on here. A lot of these repayment calculations are themselves blunders by HMRC. Once we're happy they have done their sums properly, we can move on to whether you can fight them for not having got their calculator buttons pressed quickly enough.

Thanks very much for your reply (assume it was me!) Okay - what do you need to know specifically? What I earned & how much tax I paid & underpaid? Sorry to be slow about this - I try to save lives for a living - don't generally have to number crunch too much:(

becky8976

We are having a nightmare with HMRC at the moment. It all started at the begining of Feb this year when 2 tax calculations dropped through the door for my husband (who is a nurse and works for the NHS and does some angency work too), one for 08/09 (underpayment of £3757.00) and 09/10 (underpayment £7320.80). After picking myself up off the floor I realised the previous underpayment was included in the 7K! After speaking them they said that he'd not had the right tax code and needed to pay it and someone would be in touch to arrange a payment plan over possibly 3 years. Since then we have had 3 new tax codes for tax year 10/11 (not sure why!!) Then in March we received a few more tax calculations dating back to 05/06!! 05/06 my husband overpaid by £1070.17 (we were not aware of this at the time). We are missing the tax calculation for 06/07. 07/08 states an underpayment of £566.75 (they have adjusted the amount to show the overpayment from 05/06 so therefore left us to presume that the correct amount exactly had been paid in 06/07, which we doubt very much!!) 08/09 we have an underpayment of £4323.75 (again this includes the underpayment from the previous year)and then finally 09/10 addsup to a grand total of £7887.55. We contacted them after receiving all of them and was told we could pay it ack over 3 years at £215.00 a month! I told them that we managed to pay our mortgage and bills because we don't drive a new car or go on holidays abroad. To us that amount a month is a brand new car and a fantastic holiday! I have wrote to them stating that we have not moved house in these years so we are rather bemused as to why they have let this go on for so long before contacting us. I am hoping that we will be able to get most of this written off. Surely the HMRC should take responsibility for letting this get so out of hand. There obviously was a problem back in 07/08 and they have let this continue without letting us know. The helpful man I spoke to did remind me that it's up to the tax payer to make sure that they are paying the correct amount of tax via the tax code but as I explained to him how are the normal working person supposed to know what all the tax codes mean, surely that is what the HMRC is for!! I sent a letter guarenteed delivery 3 weeks ago and have not had any response whatsoever, not even to acknowlege receipt. Do they have a certain length of time to respond or am I best just chasing them. The last thing we want is them to take it out via tax codes as we will not be able to pay the bills.

Thanks for reading and any advice would be great!!

Becky

Wendall_2

becky8976 wrote: »

We are having a nightmare with HMRC at the moment. It all started at the begining of Feb this year when 2 tax calculations dropped through the door for my husband (who is a nurse and works for the NHS and does some angency work too), one for 08/09 (underpayment of £3757.00) and 09/10 (underpayment £7320.80). After picking myself up off the floor I realised the previous underpayment was included in the 7K! After speaking them they said that he'd not had the right tax code and needed to pay it and someone would be in touch to arrange a payment plan over possibly 3 years. Since then we have had 3 new tax codes for tax year 10/11 (not sure why!!) Then in March we received a few more tax calculations dating back to 05/06!! 05/06 my husband overpaid by £1070.17 (we were not aware of this at the time). We are missing the tax calculation for 06/07. 07/08 states an underpayment of £566.75 (they have adjusted the amount to show the overpayment from 05/06 so therefore left us to presume that the correct amount exactly had been paid in 06/07, which we doubt very much!!) 08/09 we have an underpayment of £4323.75 (again this includes the underpayment from the previous year)and then finally 09/10 addsup to a grand total of £7887.55. We contacted them after receiving all of them and was told we could pay it ack over 3 years at £215.00 a month! I told them that we managed to pay our mortgage and bills because we don't drive a new car or go on holidays abroad. To us that amount a month is a brand new car and a fantastic holiday! I have wrote to them stating that we have not moved house in these years so we are rather bemused as to why they have let this go on for so long before contacting us. I am hoping that we will be able to get most of this written off. Surely the HMRC should take responsibility for letting this get so out of hand. There obviously was a problem back in 07/08 and they have let this continue without letting us know. The helpful man I spoke to did remind me that it's up to the tax payer to make sure that they are paying the correct amount of tax via the tax code but as I explained to him how are the normal working person supposed to know what all the tax codes mean, surely that is what the HMRC is for!! I sent a letter guarenteed delivery 3 weeks ago and have not had any response whatsoever, not even to acknowlege receipt. Do they have a certain length of time to respond or am I best just chasing them. The last thing we want is them to take it out via tax codes as we will not be able to pay the bills.

Thanks for reading and any advice would be great!!

Becky

Hi Becky

I'm the nurse that posted a request for help just before you...looks like we're billy no mates here!

I went to see an accountant at the weekend - not a PAYE specialist, but he did give me a bit of advice. We basically need to find out who was at fault. Having phoned NHS Professionals (my nursing agency) they have said they cannot change any tax codes without the say so from HMRC. However HMRC have told me it's NHSP's fault. The accountant has suggested I gather as much evidence as I can, so I've written to NHSP asking them when my tax codes were changed over a period of 4 years & under whose authority - I've also asked for copies of the 'EDI reports'. These are the notifications from HMRC requesting employers to change tax codes. I haven't given them a long explanation about the situation, just that I have a general tax office query as I don't want them to get defensive!

Going back to the accountant when I get this info - if you're still interested I'll let you know what steps he suggests next.

By the way, I too sent a recorded letter to HMRC at the beginning of March. I have phoned them since & they've told me not to expect a reply before the middle of April due to lots of queries!

I'm beginning to wonder how many NHS staff this has happened to...

mugz47

Just a small message of hope - I received a demand for just under £2,000 as underpayment. As I felt this was the Revenues mistake, I sent two letters a week telling them why I did not feel I should pay, got one standard reply, which I ignored, carried on with my two letters for 7 weeks, and last week got a letter to say they are not carrying on with the claim. This was the second letter received, so don't expect answers straight away, but above all, do not give up - it was the Revenues fault, not yours that you underpaid, so they should take the responsibilty.
Hope this helps someone to carry on the fight!!

dori2o

Wendall wrote: »

Hi Becky

I'm the nurse that posted a request for help just before you...looks like we're billy no mates here!

I went to see an accountant at the weekend - not a PAYE specialist, but he did give me a bit of advice. We basically need to find out who was at fault. Having phoned NHS Professionals (my nursing agency) they have said they cannot change any tax codes without the say so from HMRC. However HMRC have told me it's NHSP's fault. The accountant has suggested I gather as much evidence as I can, so I've written to NHSP asking them when my tax codes were changed over a period of 4 years & under whose authority - I've also asked for copies of the 'EDI reports'. These are the notifications from HMRC requesting employers to change tax codes. I haven't given them a long explanation about the situation, just that I have a general tax office query as I don't want them to get defensive!

Going back to the accountant when I get this info - if you're still interested I'll let you know what steps he suggests next.

By the way, I too sent a recorded letter to HMRC at the beginning of March. I have phoned them since & they've told me not to expect a reply before the middle of April due to lots of queries!

I'm beginning to wonder how many NHS staff this has happened to...

What you also need to find out is whether a P46 has been sent to HMRC from NHSP.

The P46 notifies HMRC that you have commenced work for a new employer. It is completed by the employee and based on the information that is submitted on the form tells the employer what tax code to operate.

If HMRC did not receive this form it will not have been possible for them to issue a code to the employer.

With regards to Becky.

If you have not received an assessment for 06/07 this means that your hsbands tax affairs for that year were either a) correct and all tax paid, or b) he has over/under paid tax but this over/underpayment is within HMRC's tolerances for that year (£300 for underpayments or £10 for overpayments) so no asssessment is needed to be issued and the year is shown as balanced.

The reason you have not had a response to your letters is that there is currently 10-12 weeks post on hand.

AS for Mugs47, whilst some of the underpayments will have arisen as a result of HMRC error, based on the ones I have seen (currently dealing with on average 3-4 calls per day), the majority are due to either A) no P46 being received by HMRC from the employer, students completing multiple P38(s) forms and then having an income in excess of their personal allowance, C) People who have 2 sources of income but due to extra overtime/pay rises have earned enough to pay tax at the higher rate on their total income, but each income alone only attracts a tax charge of 20%, D) people have started to receive an employer benefit throughout the year and finally E) The code issued by HMRC has not been operated by the employer.

There are obviously errors that have occurred within HMRC, but as with all organisations no matter how big or small, they do happen.

mugz47

Just a quick clarification - I have worked for the same company for 12 years, no change in circumstances, our payroll have gone by the code sent to them by the Revenue. I am 64, and fortunately will fight forever when I know it was not my error, but there are a lot of people who have received this demand, have had no answers to any letters sent, and must be worried sick on how to pay back. Just want them to know to keep at it, don't give up, someone WILL listen in the end. Good Luck to you all.