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£8000 unexpected underpayment of tax due to a catalogue of errors with tax office and

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  • suso
    suso Posts: 548 Forumite
    Its such a big underpayment that sympathy is hard to come by, to be earning such a salary you must be a qualified person and as such you must be taking financial advice, HMRC are calculating the underpayment on the P14 info received from the employer.

    Tax could be reduced by declaring gift aid, personal pension contribution payments - it will be increased by declaring interest payments received, dividends any other income.

    as a rough guide 8000 means that 40,000 pound of income has been taxed at the wrong rate. on two years of income.

    There's a thing called the budget which yearly announces the amount of income that is taxed at the basic rate of tax, you may have heard of it, some of the papers run a few pages each year about what it will mean to the general pubic.

    As no figures have been supplied by the OP, nobody knows if they are receiving BIK or just a large salary which has been taxed at the BR.

    if it is the latter, then in order to be underpaid by 8000 in two years, means that your income was approx £70,000

    This would mean tax was deducted at basic rate 70000*20% = 14000
    Tax should have been deducted at
    0-6475 @ 0%
    6475 - 43875 @ 20 % = 7480
    43875 - 70000 @ 40% = 10450
    Grand total = 17930
    Difference = 3930

    Income taxable at higher rate 26125 hardly just in the higher rate
    He's not an accountant - he's a charlatan
  • patanne
    patanne Posts: 1,286 Forumite
    All this tax mess goes to prove the necessity for financial education in schools. Maybe the next step should be compulsory seminars every 10 years for all adults!!! With a special one for people approaching retirement as the taxing of pensions seems to be a major problem area for the unwary/unaware.
  • family_man
    family_man Posts: 14 Forumite
    edited 27 March 2011 at 9:15PM
    suso wrote: »
    Its such a big underpayment that sympathy is hard to come by, to be earning such a salary you must be a qualified person and as such you must be taking financial advice, HMRC are calculating the underpayment on the P14 info received from the employer.

    Tax could be reduced by declaring gift aid, personal pension contribution payments - it will be increased by declaring interest payments received, dividends any other income.

    as a rough guide 8000 means that 40,000 pound of income has been taxed at the wrong rate. on two years of income.

    There's a thing called the budget which yearly announces the amount of income that is taxed at the basic rate of tax, you may have heard of it, some of the papers run a few pages each year about what it will mean to the general pubic.

    As no figures have been supplied by the OP, nobody knows if they are receiving BIK or just a large salary which has been taxed at the BR.

    if it is the latter, then in order to be underpaid by 8000 in two years, means that your income was approx £70,000

    This would mean tax was deducted at basic rate 70000*20% = 14000
    Tax should have been deducted at
    0-6475 @ 0%
    6475 - 43875 @ 20 % = 7480
    43875 - 70000 @ 40% = 10450
    Grand total = 17930
    Difference = 3930

    Income taxable at higher rate 26125 hardly just in the higher rate

    I can’t believe how rude some people are and I am not looking for sympathy. My basic salary is just in the higher rate, my profession is not skilled its semi skilled manual work, and I practically lived in the business for over two and a half years on overtime around the clock, most of the time without sleep. Yes I benefited financially from it but the company benefited far far more.

    I don’t sit and analyse my payments when I get them I just know I've put the hours in, I work hard to provide and care for the young family that I have. I feel very fortunate to have a good job (IMO) and work for a professional company but I expect them to treat that more than just a number, and one that gets overlooked.
  • Sambucus_Nigra
    Sambucus_Nigra Posts: 8,669 Forumite
    So, post your p60s here, and work out what's gone wrong!

    You have to look into these things, not just take their figures at face value.
    If you haven't got it - please don't flaunt it. TIA.
  • Mikeyorks
    Mikeyorks Posts: 10,377 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    I assume - as has become clear - you're not going to post the P60 figures (pay / tax / Code) for each of the 3 years? As that would at least give some clarity.

    Failing that - at least check your P60 figures back to the P800s. To at least ensure your employer / HMRC are working off the same figures.
    If you want to test the depth of the water .........don't use both feet !
  • ryan86uk
    ryan86uk Posts: 173 Forumite
    taxing wrote: »
    Take responsibility for your own affairs and pay up.

    Regards.


    This man is asking for advice, the last thing he needs is a jumped up little rat bag like you putting the most unhelpful comment in the world up. :eek:
  • jem16
    jem16 Posts: 19,616 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ryan86uk wrote: »
    This man is asking for advice,

    Then why doesn't he post the figures that have been asked for so that someone can give that advice?
  • suso
    suso Posts: 548 Forumite
    family_man wrote: »
    I can’t believe how rude some people are and I am not looking for sympathy. My basic salary is just in the higher rate, my profession is not skilled its semi skilled manual work, and I practically lived in the business for over two and a half years on overtime around the clock, most of the time without sleep. Yes I benefited financially from it but the company benefited far far more.

    nothing rude in the post, and I didn't offer sympathy, you are not just in the higher tax band to have aquired such an underpayment

    did you actually read the post ? I said where you could save tax,

    Can you tell tell me a semi skilled job that pays 70,000 per annum ?

    post your p60's info and p45 info and details of other earnings including savings income , and we can see if there are mistakes,
    He's not an accountant - he's a charlatan
  • patanne
    patanne Posts: 1,286 Forumite
    Well suso it appears you have just proved that either HMRC HAS got it wrong or the OP is lying about his job & I know which option I'd select. I always thought that most people on large salaries (as opposed to wages) did not get paid overtime which is what the op says bumped up his wages
  • Or the figures are wrong! But we shall never know....
    If you haven't got it - please don't flaunt it. TIA.
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