tax office say we owe them money 4 years on

sunrise27_2

my husband has just got a tax calculation in for the year 2007 -2008 which says we owe them £350 it says the amount of car benefit included in your paye code was lower than the amount taxable
this is 4 years ago !! where do we start to try and sort it out
surely it was the job of my husbands employers at the time to sort out his tax , we thought everything was in order

chrismac1

First make sure the calculation is correct, many are not. Then if it is, look up the Esc A19 threads on this website - many have successfully travelled where you may be going. You should be winning this one!

sunrise27_2

but I don't even know where to start making sure the calculations are right ???
it says there is a car allowance of 4655 How do I know if that is right ?
and am I right in thinking that considering we are now in the tax year 2011/ 2012
only just sorting out an underpayment from 2007/2008 is wrong ??

dori2o

sunrise27 wrote: »

but I don't even know where to start making sure the calculations are right ??? You need to find your P11d and P60's/P45's for that year. Your employer(s) will have provided this information to you
it says there is a car allowance of 4655 How do I know if that is right ?This information will be on your P11d
and am I right in thinking that considering we are now in the tax year 2011/ 2012
only just sorting out an underpayment from 2007/2008 is wrong ??

NO. HMRC have the same rights as an individual to look back over previous tax years. (Moreso in cases of suspected tax fraud)

The timelimits people refer to are for HMRC to act upon information received in respect of changes to a persons details that need to be updated in order to ensure that as close as possible the correct amount of tax is collected.

The car benefit in your code could have been wrong for a few reasons, normally due to a change of company car that has not been notified until the P11d is submitted at the end of the tax year.

chrismac1

Overall sunrise you are right in practice. Dire performance from HMRC is all too common these days and the Tribunals and higher Courts are well aware of this, not to mention MPs. So in the end you are not going to have to pay this tax if you play a half-decent hand here.

Firstly, what sort of car - make, model, cc - and for how many months during 07-8 did you have the car? And what emissions in g / km of CO2, though if you post the car model we can soon tell you this and the correct benefit level.

However, in many respects this is neither here nor there. The car benefit rules were completely messed up and over-complicated under Labour, one of many factors which doubled the UK tax code during their 13 years. So the onus here is on the employer to get it right and report this on the P11d submission to HMRC by 5 July 2008. This they almost certainly did - otherwise where have HMRC suddenly got the information from over 3 years later?

Provided you have acted in reasonable belief that your tax affairs were in order, based on your posts you have a rock solid Esc A19 claim. If you look at other Esc A19 posts on this site, typically you'll get knocked back a few times before HMRC finally surrender. But they will surrender, ignore all the bluster, smoke and mirrors until they do.

sunrise27_2

I will find out about the car from hubby and let you know
I will fight this as much as I can , I love a good fight !!!

dori2o

chrismac1 wrote: »

Overall sunrise you are right in practice. Dire performance from HMRC is all too common these days and the Tribunals and higher Courts are well aware of this, not to mention MPs. So in the end you are not going to have to pay this tax if you play a half-decent hand here.

Firstly, what sort of car - make, model, cc - and for how many months during 07-8 did you have the car? And what emissions in g / km of CO2, though if you post the car model we can soon tell you this and the correct benefit level.

However, in many respects this is neither here nor there. The car benefit rules were completely messed up and over-complicated under Labour, one of many factors which doubled the UK tax code during their 13 years. So the onus here is on the employer to get it right and report this on the P11d submission to HMRC by 5 July 2008. This they almost certainly did - otherwise where have HMRC suddenly got the information from over 3 years later?

Provided you have acted in reasonable belief that your tax affairs were in order, based on your posts you have a rock solid Esc A19 claim. If you look at other Esc A19 posts on this site, typically you'll get knocked back a few times before HMRC finally surrender. But they will surrender, ignore all the bluster, smoke and mirrors until they do.

Sorry, but I fail to see what information HMRC have failed to act upon in order to reduce the risk of underpayment.

This is just the same as being underpaid at the end of the current tax year because BIK are higher than those coded due to either increased costs of BIK paid for by an employer, or due to a company car change not notified until the end of the tax year on a P11d.

sunrise27_2

right where to start ?? I have managed to get copies of the forms I need but still have no idea of where to start with them
its looks like for the year 2006-2007 he changed cars he went from a bmw 320D SE which had a list price of 21185 and the cash equivalent was worth 1290 and then in the July he got a jaguar x type sport which had a list price of 29791 and the cash equivalent was 3845 making a total of a cash equivalent of 5135

then in the year 2007 - 2008 which is the year they say we owe money from he had the jaguar x type sport until February 2008 as left the company and had his own car for the rest of the tax year - the cash equivalent on the 07/08 form is 4655.05
can anyone shed any light on why they're now saying we owe £350 tax for 07/08 and why its taken them 4 years to realise it ??

chrismac1

They ought to have sent you a calculation showing Gross earnings from P60 + BIK + unearned income, and also tax paid. Against that the calculation will arrive at a tax due figure, which must be greater than the tax paid.

Your first step is to understand the numbers in this calculation and make sure it is correct. The easiest and quickest challenge is to be able to write a letter saying "Dear HMRC you have made a howler with your abacus, here is the correct calculation....."

sunrise27_2

how can I write a letter to the tax people when I don't really understand all the figures ??
what is un earned income ??

jennifernil

Things like bank interest.