Confused about Child & Partner tax

scan1703

Hi, 3 items I am concerned about!

About 18 months ago my salary went down by £5000, I assumed the tax office would automatically adjust any tax on my payslips so didn't check, should I call them to ask if I am on the right tax code, is there anyway I can check.

Secondly, my partner moved into my home 24 months ago, again I didnt realise I had to inform anyone at tax office, would this affect my tax payments?

Lastly, I had a baby in October 2009, my partner gets £20 a week child tax credit. Do I again need to speaj with tax office, should my tax have deducted after the birth of my 1st child? We are having another in 10 weeks so need to resolve this one.

Many thanks for any advice.

regards


Gary

paddedjohn

unless you went from being a high rate tax payer to a low one then your tax code will stay the same, 647. this is going to change in april i think to 747. regardless of being single or married your allowance is the same

nannytone_2

this is a very confusing post!

unless you were a higher rate tax payer, earning 5k a year less shouldnt affect your tax code.
you say you didnt inform anyone when your partner moved in............were you or your partner receiving any single person/low income benefits?
is the £20 a week child tax credit or child benefit?
if it's child tax credit are you claiming as a couple or is your partner claiming as a single person?

nannytone_2

is it changing to 747 for everyone on the basic rate of tax?
my husbands tax code was 657 ( he got an allowance for washing uniform) he got a new tax code last week......histax code for the next year will be 663L.
he was paid last week and his tax code on his wage slip was 603.
he phoned and they said it was something about taxable benefits ( he gets free train pass) but it seems odd to take it all in one go!

scan1703

Thanks for you prompt answers.

paddedjohn - No wasn't a high rate tax payer, my current tax code is 655L not 647 I wonder why that is?

nannytone - Sorry for confused post, I only posted as I seen Martin Lewis urging everyone on Daybreak TV to contact tax office if any circumstances change. Specifically mentioned, newborns & change of dwelling status

No we were not receiving any benefits at all, both in full time employment.

£20 a week is Child tax credit, claimed as a couple I believe

regards

nannytone_2

i think what he was talking about referred more to tax credits, as changes in circumstance change entitlement.

youre obviously getting a tax allowance from somewhere. do you wear uniform at work as this is the most obvious reason.

scan1703

Hi, no I don't wear uniform, just a normal job, we don't claim any benefits at all except for Child Tax credit [£20] & Working tax credit [£10]. I will call tax office later to discuss, probably not due/owe anything but best to be safe as there are many TV programs urging people to right now.

MrsManda

changes which you need to report when claiming Tax Credits can be found here:
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/TaxCreditsandChildBenefit/TaxCredits/Keepingyourtaxcreditsuptodate/Changesthataffectyourtaxcredits/DG_073824

Your tax code will have stayed the same with th drop in income as you will still pay 20% on everything you earn above your personal allowance. Your personal allowance is unlikely to have changed and that's what your tax code shows.
If you're unsure you can always use the Tax Code calculator here:
http://www.moneysavingexpert.com/family/check-tax-code?dd

How a tax code is worked out can be found on the HMRC website:
http://www.hmrc.gov.uk/incometax/tax-codes.htm

But it's always a good idea to check with tax office if you're uncertain of something, just be aware that the phone lines are likely to be busy at the moment as everyone will be ringing about tax codes and associated issues.

MrsManda

nannytone wrote: »

is it changing to 747 for everyone on the basic rate of tax?
my husbands tax code was 657 ( he got an allowance for washing uniform) he got a new tax code last week......histax code for the next year will be 663L.
he was paid last week and his tax code on his wage slip was 603.
he phoned and they said it was something about taxable benefits ( he gets free train pass) but it seems odd to take it all in one go!

The personal allowance for 2010/11 was £6475 for people who earned less than £100,000 so the basic tax code for most people was 647L. For 2011/12 this is going up to £7475 so the basic tax code is 747L.
Not everyone will get this tax code, allowances are added to it and taxable company benefits are substracted from it to leave you with the appropriate level of personal allowance.
http://www.hmrc.gov.uk/incometax/codes-company-benefits.htm
http://www.hmrc.gov.uk/rates/it.htm

Does this make sense?

nannytone wrote: »

he phoned and they said it was something about taxable benefits ( he gets free train pass) but it seems odd to take it all in one go!

When did he start receiving this benefit? Did he inform the tax office when he started to receive the benefit?

New company benefits and your tax code

If you get a new taxable company benefit HMRC changes your tax code to take account of:

• the 'actual' amount received in the current tax year
• the 'annual' amount in the next tax year

If you get the benefit for part of the year only HMRC divides the actual benefit by 12 (months) and collects the amount due from the date the code changes - this means that you won't have paid enough tax at the end of the year. HMRC will collect the tax that you owe next year along with the annual amount due for that year. This has the effect of spreading your payments so that you don't have to pay the full amount right away.

http://www.hmrc.gov.uk/incometax/codes-company-benefits.htm

zagfles

scan1703 wrote: »

Hi, no I don't wear uniform, just a normal job, we don't claim any benefits at all except for Child Tax credit [£20] & Working tax credit [£10]. I will call tax office later to discuss, probably not due/owe anything but best to be safe as there are many TV programs urging people to right now.

Note that it's the tax CREDITS office you need to tell about changes in circumstances, not the income tax office. They're both HMRC but completely different departments and completely different rules.

Income tax doesn't care how many kids you've got, whether you have a partner or not, etc. Only about how much you earn, and that's (mainly) taken care of by PAYE.

Tax credits do care about these things, so they're the ones you need to tell.

Having said that - your tax code (this is INCOME tax), is a bit higher than your personal allowance like others have said so there must be a reason, they should have sent you a coding notice which tells you why. Could be some professional body, or union etc, which you're paying about £80 to?

scan1703

Firstly thanks MrsManda & zagfles for all your help.
I rang the tax office and they said it was a mistake from my previous job 12 years ago! I used to work in glass/windows and apparently had £80pa for clothing which I didn't even know about!

She has now change my code to 647 for year 2010-11 & 2011-12 so hope thats all sorted now, probably hit with a bill no doubt.

Tax Credits, now that who I need to speak to is it? Thanks for the tip, will call them this afternoon to update them. Cant help think my partner would have done all this when she filled out the forms after birth of our 1st baby but I guess its worth asking.

Thanks again.