Nil Tax Code when claiming Jobseekers Allowance

jonathon01

Hello,

What happens with respect to the Nil Tax Code when a person's becomes bankrupt and their sole source of income is Jobseekers Allowance but they had been on PAYE earlier on in the tax year?

debtinfo

you only get a NT code if you are employed when you go bankrupt

BB&B

And it ceases when you claim JSA, etc, and then it does NOT restart!!

jonathon01

So:

1. Any PAYE paid before the date of the bankruptcy is irrelevant?

2. If, say, you are claiming JSA on the date of bankruptcy, then one month later get a full time PAYE job, there would never be a NT code generated simply because you were claiming JSA on the date of bankruptcy and that is all that is relevant at any point during the bankruptcy?

confused76

jonathon01 wrote: »

So:

1. Any PAYE paid before the date of the bankruptcy is irrelevant?

2. If, say, you are claiming JSA on the date of bankruptcy, then one month later get a full time PAYE job, there would never be a NT code generated simply because you were claiming JSA on the date of bankruptcy and that is all that is relevant at any point during the bankruptcy?

that's right and the NT code stops at the end of the tax year in which you went br

BB&B

jonathon01 wrote: »

1. Any PAYE paid before the date of the bankruptcy is irrelevant?

Except if you get any back as a tax refund after the bankruptcy date, this is then technically the property of the OR.

So if prior to bankruptcy you had paid £5000 in tax, and you then go bankrupt, should HMRC send a refund for £5000 to you , you MUST inform the OR as it is actually an asset in your bankruptcy estate.

Please DO NOT spend it as the OR will find out and then heaven help you!!

Tim

jonathon01

Cool, thank you for all of your replies.