Emergency Tax Since April

lynn44

Thanks isasmurf....but why does it say on my compliment slip less tax & NI 68%.... or ok if thats correct is 32% tax is that correct amount for 503L1 tax code ?

Hoddie_2

Yes, it does sound right to have deductions of 32%. We're back to the 0%/10%/22%/40% again. If the payment covered a particular month, the first £420 would be tax free, the next £180 at 10% and the next £2,762 at 22% and the rest at 40%. On top of that there'll be National Insurance at 11% (not exactly sure of the rate but it's around 11%).

It'll be reworked for tax next time you're paid now they have the correct code. If you have paid too much you'll get it back then.

SonniC55

Hoddie
The 50% Max deduction for tax you refered to relates to K codes only - Payroll software would deduct over 50% if it calculated this was due.

Lynn
Its worth noting here that if your employer made an error in calculating your liability from previous pay it becomes thier error, they cant just decide to recover it from you at a later date.

Lynn this just seems to get deeper and deeper and it sounds now that your employer is using scare tactics to shut you up, I find this utterly shameful.

Best advice I can offer at this point is to involve ACAS as you are bordering on a case of constructive dismissal. However if you choose this route you must try your companies internal grievance procedures first.

Seek ACAS's advice on the strength of your case given that they have breached the terms of your contract of employment in not paying you accuratly and on time - and yes this does count for overtime too.
As for any overpayments your company has made or underdeductions they have taken which they now try to recover you should reject ANY deduction from your earnings here and claim the principle of Estoppel .

Under the principle of Estoppel your employer can NOT recover any of these payments provided you can show the following
1) The monies received have now been spent
2) You believed (or were led to believe) that the payment made was due to you
3) Recovery of the monies would cause you undue hardship

I hope you can get a resolution to your problem - I'm flabbergasted at your employers attitudes here especially considering they appear to be to blame.

Finally with regard to the 68% deduction im stumped as to how your payroll office could even consider this to be correct. Did you speak directly with the payroll manager or the filing clerk !
Im only guessing here but in addition to tax and NIC another deduction has been added here to bring the total upto 68%
Its worth noting that your employer can NOT apply ANY deduction to your earnings (apart from statutory - ie PAYE, NI) without your written consent (apart from a deduction of earnings order issued by a court, CSA or council tax)

Hope this helps

Hoddie_2

Hoddie
The 50% Max deduction for tax you refered to relates to K codes only - Payroll software would deduct over 50% if it calculated this was due.

This isn't true, although I agree is most commonly associated with K codes. HM Revenue & Customs would not knowingly issue a code that resulted in a tax deduction of more than 50% (which is why there's what's known as a K code limit), and were this to happen it is usually an indication that the employer was previously using a different code than HMRC believed.

E13 - Day to Day Payroll explicitly says you must deduct tax equal to the lower of a) what the calculator tables show or b) 50% of the 'pay in the week or month'. This is the regulatory limit.

SonniC55

Hoddie - im affraid this is true
If you check E13 is does specify that the regulatory limit is applicable to K-Codes only. This can also be seen on the P11 working sheets
http://www.hmrc.gov.uk/forms/p11.pdf

Having encountered many occasions when a code change resulted in a large deduction of tax (over 50%) a quick call to HMRC to has always resulted in an agreement of applying a Wk/M1 status as a temporary fix until a revised coding is issued.

However the taxpayer should always be made aware of this temporary change as it could result in an underpaid liability at year end (which is normally fixed by another code change)

Hoddie_2

If you check E13 is does specify that the regulatory limit is applicable to K-Codes only. This can also be seen on the P11 working sheets

Having reviewed E13 it seems fairly clear that it does only apply to K-codes. However, I'm fairly sure it applies in all cases. A colleague suggested that maybe E13 covers K-codes only as in theory only these codes could take more than 50%. Only if a mistake is made when issuing a cumulative code, or the code history not fully known would a non-K-code collect more than 50%. Strange, I'll have to check this out.

nigel26

hi everyone
I need help to find out about my tax code because im only 16 and have the tax code BR/1 which i dont believe is right - i dont think i should even pay tax cus i dont even earn a grand a year any helpers?

jem16

nigel26 wrote: »

hi everyone
I need help to find out about my tax code because im only 16 and have the tax code BR/1 which i dont believe is right - i dont think i should even pay tax cus i dont even earn a grand a year any helpers?

You should have started a new thread rather than tacking your question onto the end of a 2 year old thread.

BR/1 is not the correct code that you should be on if this is your only job. It means you are paying 20% tax on all of your earnings and have no tax-free allowances. You are normally put on this code if you have not handed your employer a P45 from a previous job or completed a P46 if this is your first job. Assuming you have no P45 you need to go into work and complete a P46.

You should be on tax code 603L. If you only earn around £1000 a year you will pay no tax as you are well under the personal allowance of £6035.

kazmc

Also if you are a student and will ONLY be working during holidays then ask your employer for a student form which once completed will put you on an NT coding (No Tax)