Tax underpayment!!!

Amanda_Cross

I've just had a letter from HM Customs to say in 08/09 i underpaid my tax by £800plus and apparently i phoned them to query it (which I did) but left it that I had underpaid and they were going to deduct it from my salary each month. They say they were waiting for me to reply to them!!!! It is now 2011 - do I need to pay this!?????

sammyjammy

Yes of course you do, if they said they would take it PAYE and didn't why didn't you contact them?

evie-mays-mum

sammyjammy wrote: »

Yes of course you do, if they said they would take it PAYE and didn't why didn't you contact them?

Incorrect......
If you were one of the people that the tax office issued with an incorrect tax code,then as it is over 12 months since the end of that financial year then they are breaking there own rules by only just asking for it back.
Call them and can ask for an "extra-statutory concession", also known as an ESC A19.

I did this on wednesday afternoon for my uncle who had a £1600 demand and he was telephoned on thursday morning to be advised they were clearing the amount and would be sending him conf in writting.
hope this helps x

trevormax

actually, if someone is issued with the wrong tax code and underpaid tax, HMRC are well within their rights to ask for the tax to be paid up to 4 years after the underpayment. Normally, you would pay back an underpayment on the second tax year after the tax year the underpayment took place.

I.e. underpaid in 08/09, identified in 09/10, collected in the 10/11 tax year through your tax code.

You are correct in saying that many people were issued with incorrect demands for underpaid tax, incorrect tax codes etc in the 08/09 and 09/10 tax years due to the new computer system they started using at the time.

OP, first thing I would do is contact them asap to find out how the underpayment happened. It is possible this is an error and you have not. If you have underpaid and you can PROVE that it was entirely HMRC's fault, that you provided them with all the details possible to allow them to ensure you should not have underpaid AND they did not act on these details, you may be able to get them to remove the underpayment.

If the underpayment happened in 08/09, then they should already be collecting this money by reducing your 10/11 tax code. Check your tax code and see if it is less than 647L. If so, you may be paying it already.