Tax code change

borris78

Hi

Recently received a ltter from the IR saying my tax code has been changed to 591L for the current tax year (10/11). It was 607L. I'm assuming this means the lower code means I'm going to be paying more tax? Don't you just love it...

Question is - nothing has changed with my employment other than a pay increase but I've not moved in to a new tax band and I don't think that would be a reason to change the code.

What would explain the change in tax code? Do I need to speak with my employer?

jem16

borris78 wrote: »

I'm assuming this means the lower code means I'm going to be paying more tax?

Yes it does.

Question is - nothing has changed with my employment other than a pay increase but I've not moved in to a new tax band and I don't think that would be a reason to change the code.

That wouldn't have an effect on your code. A taxable benefit would though.

What would explain the change in tax code?

What does your P2 coding notice say?

Do I need to speak with my employer?

They won't know. It's HMRC you need to speak to if you have received no P2 coding notice to explain the new code.

zax47

New taxable benefits or recovery of previous years under paid tax are the most common reasons for a reduction in tax code. The coding notice will show how they've calculated it.

borris78

Thanks both. Benefits have stayed the same (pension and private medical insurance) so I'm guessing it's something to do with that.

Mikeyorks

The Code 591L reflects a £160 reduction from the previous. So something has changed (at least in the HMRC view)?

The P2 (Coding Notice) should tell you precisely.