P800 Tax underpaid.

benjo

I would be eternally grateful for any advice on OH's situation.

P800 for year 2007/2008 shows an underpayment of £1090.

"you had two employments at the same time and both employers were applying a PAYE code giving the full taxe free allowances - you therefore received more allowances than were due".

I checked the PAYE coding for that year...

"your new taxe code for the year 6 April 2007 to 5 April 2008 is 99L which replaces 522L. You need a new taxe code so NHS pensions paymaster can work out how much tax to take off the payments they make to you."

SOA.

Incapacity Benefit £4230 (taxable)
NHS Pension £6000 (ish) (taxable)
DLA (non taxable).

I phoned IR who said that NHS pensions applied a tax code of 522L instead of 99L for the year 2007/2008.

The notes that came with the P800 suggest that if your pension payer has made a mistake or not taken reasonable care to operate the correct tax code then write to IR and explain why you think they made the mistake, but the IR helpline gentleman said....

"I shouldnt be telling you this, but you can write to who you want, it wont make any difference at all, it is a complete waste of time".

Is he right? Should I make a fuss? Interested in anyone who has experienced this - and a BIG thankyou to everyone who takes the time to read this epic x x x

roddydogs

Look up ESC A19.

dori2o

roddydogs wrote: »

Look up ESC A19.

I doubt it would apply in this case.

HMRC have operated correctly and within the time limits - they have issued a code to the pension provider, but this code has not been operated.

You can write to HMRC, confirming that as far as you were aware your tax affairs were in order and that you believe this is the pension providers fault for not operating the correct code.

However, HMRC will only chase the pension provider if it can be demonstrated that they knowingly have not operated PAYE correctly.

In this instance the pension provider could simply claim they did not receive the notice.

taxing

benjo wrote: »

I would be eternally grateful for any advice on OH's situation.

P800 for year 2007/2008 shows an underpayment of £1090.

"you had two employments at the same time and both employers were applying a PAYE code giving the full taxe free allowances - you therefore received more allowances than were due".

I checked the PAYE coding for that year...

"your new taxe code for the year 6 April 2007 to 5 April 2008 is 99L which replaces 522L. You need a new taxe code so NHS pensions paymaster can work out how much tax to take off the payments they make to you."

SOA.

Incapacity Benefit £4230 (taxable)
NHS Pension £6000 (ish) (taxable)
DLA (non taxable).

I phoned IR who said that NHS pensions applied a tax code of 522L instead of 99L for the year 2007/2008.

The notes that came with the P800 suggest that if your pension payer has made a mistake or not taken reasonable care to operate the correct tax code then write to IR and explain why you think they made the mistake, but the IR helpline gentleman said....

"I shouldnt be telling you this, but you can write to who you want, it wont make any difference at all, it is a complete waste of time".

Is he right? Should I make a fuss? Interested in anyone who has experienced this - and a BIG thankyou to everyone who takes the time to read this epic x x x

Have to agree that you don't seem to have much of a case here - when you get a new code notice (which you agree/accept) you are meant to check your next and following payslips to make sure the employer/pension provider is actually using that new code....
You can try the ESC A19 route but I wouldn't hold my breath.

Ask for time to pay (if you do lose) or see if they will restrict your tax code to collect the underpayment over the 12 months in 2011/12 tax year - worth a try.

Regards.

dori2o

taxing wrote: »

Have to agree that you don't seem to have much of a case here - when you get a new code notice (which you agree/accept) you are meant to check your next and following payslips to make sure the employer/pension provider is actually using that new code....
You can try the ESC A19 route but I wouldn't hold my breath.

Ask for time to pay (if you do lose) or see if they will restrict your tax code to collect the underpayment over the 12 months in 2011/12 tax year - worth a try.

Regards.

Whilst I quite agree with what you say, I do feel that pension providers don't help the situation.

A lot of the people I speak to who receive pensions tell me that they don't receive a payslip every month, some never at all, and some only when there is a change, i.e. pension increases/decreases or tax code change.

I can therefore fully understand why people in receipt of pensions find it harder to keep on top of this.

Savvybunny2009

I don't think appealing will get you anywhere but if it costs you nothing more than the time to write a letter there is no harm persuing this. You wont be expected to pay this in one go, they will adjust your tax code to reflect the overpayment. Unfortunately the tax man isn't known for writing off tax that is owed.

dori2o

Savvybunny2009 wrote: »

I don't think appealing will get you anywhere but if it costs you nothing more than the time to write a letter there is no harm persuing this. You wont be expected to pay this in one go, they will adjust your tax code to reflect the overpayment. Unfortunately the tax man isn't known for writing off tax that is owed.

Especially when it's not the tax mans fault.

Mikeyorks

benjo wrote: »

I checked the PAYE coding for that year...

"your new taxe code for the year 6 April 2007 to 5 April 2008 is 99L which replaces 522L. You need a new taxe code so NHS pensions paymaster can work out how much tax to take off the payments they make to you."

I'm afraid you don't really stand a chance with ESC A19. As it contains a clause relating to your understanding of your tax affairs :

HMRC will consider the facts and circumstances of any claim that this concession should apply and decide whether it was reasonable for you to believe (prior to receiving the Tax Calculation) that your tax affairs were in order.

..... you won't get past that aspect as you were aware the Code 99L issued to you wasn't being operated. I take the point made earlier that large pension providers, in particular, don't issue payslips monthly. But they do issue them at the start of the year if the payment value is changing - and when a material change occurs - such as a Code number change.

You could try the tack that your provider has been negligent. But it has to be systemic, as opposed to transient, before HMRC will switch the liability to NHS.

benjo

NHS Pensions dont provide monthly payslips, as mentioned they send out an annual notice which contains any changes in payment rate.

Having never had a change in tax code like this ie this code was sent out as an ammendment to the annual change in allowances due to an underpayment of £72 from the previous year we were not aware that we should have expected a further notification from the pension provider as confirmation of its receipt. This is confounded a little by the pension only commencing shortly before this date - so we werent familiar with how it was administered.

Really many thanks for all the responses x x x

benjo

Well a brief, non eventful update. Within a day of starting this thread my OH wrote to the tax office appealing against the repayment demand - nothing to loose but the cost of a stamp eh?

Rang them two weeks later - they were unable to tell us if the letter had arrived since they had a backlog and I should expect a response until after the 18th April - the letter was sent signed for and was indeed signed for as being delivered.

Todate, 2 months after writing to them we have had no further response from hmrc - is this normal?

System

benjo wrote: »

Well a brief, non eventful update. Within a day of starting this thread my OH wrote to the tax office appealing against the repayment demand - nothing to loose but the cost of a stamp eh?

Rang them two weeks later - they were unable to tell us if the letter had arrived since they had a backlog and I should expect a response until after the 18th April - the letter was sent signed for and was indeed signed for as being delivered.

Todate, 2 months after writing to them we have had no further response from hmrc - is this normal?

Your type of appeal (Employer/Pension Provider Error) does take longer because in all probablility they will contact the pension provider to see what they have to say about their failure to operate the code issued and whether they are willing to pay the tax they failed to collect on behalf of HMRC. Don't give up yet.