Newbie help with underpaid tax please

vikki.s_2

I'e just had a letter through saying I owe £450 in tax for the year 08/09. I know it's not the biggest amount in the world but we're struggling enough as it is. I had a company car for 9 months over that tax year which they're saying I owe for.

I know some people will say it's my own fault for not checking, but I don't understand it properly anyway and my salary went up the same time.

I checked with my employers who said they'd informed the tax office, and I also called the tax office when I got my company car to make sure they knew about it.

I recieved a letter april last year asking if i still had a company car and rang to say i got rid of it the year before, and also in the april 2009, when i had also given back the car.

Where do I stand? I'd checked with my employers who said they had let HMRC know, and I have also spoken to HMRC 3 times in the last 2 years to check all was ok, and they said it was until I got this letter.

dori2o

When you got the car, did you receive a revised tax code from HMRC? Was this operated by your employer? How long between getting the car did it take for your employer/you to inform HMRC of the change?

The problem with company cars is, whenever you first get one/change to a car with a higher benefit value you will undoubtedly be underpaid come the end of the year. The reson for this is that the ACTUAL amount of the benefit is included in your tax code, and if you first receive the car in September and a code is issued immediately, then the new code that is issued will only collect 6/12ths of the tax that is due on the car benefit for that year due to the code being issued on a wk1/mth1 basis and the way the tax tables operate on this basis.

Phone HMRC and ask the following questions.

Did they receive details of the car, and if so when?

Did they issue a code following receipt of those car details, what was the code and when was it issued?

Then check your payslips/P60 for that year and check that the code (if issued) was operated by your employer.