Help - IR mistake and Student Loan hell

ChrissyCamberwell

I'm writing in the vain hope that someone might be able to help me!

I am classical singer, and at the moment I work full time and sing part time. I regularly submit my self assessment forms on time and agreed to pay the extra tax from my PAYE.

I just had a lovely conversation with the Inland Revenue in which they said they’ve basically not calculated my tax properly for the last five years, and now they’ve decided to ‘catch up with themselves’ and I should pay it all back in one year from April 2007. EVEN THOUGH I did everything I should have done and always got my self-assessment forms in on time. I couldn’t have been more honest about declaring my singing earnings, and now I’m being punished. Apparently, even though I got my return in well before the deadline, because they had already calculated my tax code for the year they basically couldn’t be bothered to adjust it so I haven’t been paying the right amount of tax. You’d think it would say something helpful like “if you complete your form by X we can include your repayments in your PAYE, however if you return your form after this date we will not be able to do so”. But no, all it says is “return your form by 30th September” and “if your repayments are less than £1000 in any one year we will be able to take them from your PAYE code”.

It would also have been nice if they could have told me that they weren’t taking the right amount of tax for five years, instead of just landing it on me. Thing is, they’ve taken some of it, which is why I didn’t notice….so I’m going to be paying an extra £100 in tax for the next year, and there’s nothing I can do about it.

On top of that, working in the arts at the moment so not earning very much but I’m going to be just £22.50 over the student loan repayment threshold (on the very old and very unfair mortgage style system) – before the tax fiasco comes off – so will have to pay them back at £170.00 a month too. I figured that I need a job that will pay me at least £4k a year more to just be where I am right now, in terms of take home pay.

Would be grateful for any advice....

Chrissy

malcindebt

write to HMRC advising that repaying this amount will cause you hardship and requets it is collected over 2 years, 3 if possible. They will definately do it over 2 years.

How is it that they have not collected the correct amount of tax?

One other point, The revenue are not responsible for ensuring the tax being collected, or the tax code being correct. This is the responsibility of the individual.