Employer gives wrong info to taxman

FLIPPERTY

Hi
Does anyone have any advice on the following please

My husband has just received a letter from the tax office that says he has been on the wrong tax code for the last 12 months and they have only just found out due to recent new information which his employer has provided ( no reference to what this "new information" is - he now has to pay £85.00 back to the taxman.

Is it not the employer who is at fault here - does anyone know if he has to pay this or can insist it is his company who is at fault ?

[Deleted User]

The Employer is obligated to use whichever Tax code is issued to them by HMRC. Did your Husband recieve a coding notice and now realises this code was never used? Or was the wrong code issued by HMRC? Or was some taxable benefit not reported by the Employer?

FLIPPERTY

We have looked through all his paperwork and cant find any coding notice for the tax year in question -I cant ever remember him receiving one - and I am quite good at keeping things like that and filing them away. It seems that his employer looks like they forgot to let HMRC know that he had company health insurance - which I think he then gets taxed on as a benefit ?

Mikeyorks

FLIPPERTY wrote: »

It seems that his employer looks like they forgot to let HMRC know that he had company health insurance - which I think he then gets taxed on as a benefit ?

So you will have a P11D from the employer? It will normally have come to you at the same time as HMRC was advised.

jennifernil

This sounds pretty normal to me. For 09/10 the employer has to submit the figures by, I think, end of May 2010, and your husband should get a P11D as Mike said, that tells him what benefits he has had that are liable to tax.

If this is the first year he has had this benefit then this is just HMRC catching up on the info supplied by the employer, all perfectly normal.

I presume he has had the benefit this year too? So his code number this year needs adjusted for that, and I would expect HMRC to reduce it further to collect last year's underpayment.

Since he knew this was a taxable benefit he could have notified HMRC himself, but often the amount of the benefit is not known before the end of the tax year, it would depend on when his employer pays the premiums.

Ultimately it is everyone's own responsibility to ensure they report taxable income and benefits.

FLIPPERTY

thsnks for your help everyone - looks like we are stuck with paying it then - its not a huge amount - it was moe the prinicpal of the fact that under PAYE you would hope that your employer notified the tax man on your behalf of company benefits - such is life...

Debt_Free_Chick

FLIPPERTY wrote: »

thsnks for your help everyone - looks like we are stuck with paying it then - its not a huge amount - it was moe the prinicpal of the fact that under PAYE you would hope that your employer notified the tax man on your behalf of company benefits - such is life...

I completely understand your view, but think of it this way ....

Had the employer done the right thing, at the right time, your husband would have received £85 less in net pay. As it is, he's had the benefit of that money (although he didn't realise it!) and what he now has to pay will only put him the position he would have been, had the right tax been deducted in the first place.

HTH

jennifernil

FLIPPERTY wrote: »

thsnks for your help everyone - looks like we are stuck with paying it then - its not a huge amount - it was moe the prinicpal of the fact that under PAYE you would hope that your employer notified the tax man on your behalf of company benefits - such is life...

As I said above, the employer HAS notified the tax man, it's just that these things take time to be done and acted on, and this is perfectly normal.

Do make sure that he gets the correct code number now, so that the underpayment does not continue.