Can I pay HMRC instead of having tax code changed?

anamenottaken

Today I received P800 forms for 2009-10 (I thought HMRC were not re-visiting 2009-10?) and for 2010-11 showing under-paid tax. Total under-paid for the two years is £680. I have not checked the calculations yet.

They have sent a P2 coding notice reducing my tax code by 200 (ie an adjustment of £2000 to my tax-free allowance). Again I haven't checked the validity of this as it will be applied on a Month 1/Week 1 basis.

Instead of having the change to my tax-free allowance this year, can I not be allowed to simply pay whatever tax was underpaid in previous years and retain the 747L cumulative code?

BoGoF

Yes, phone them and ask for a voluntary payslip to be sent

anamenottaken

BoGoF wrote: »

Yes, phone them and ask for a voluntary payslip to be sent

Thanks.

I expect they'll be open again before New Year.

suso

anamenottaken wrote: »

Today I received P800 forms for 2009-10 (I thought HMRC were not re-visiting 2009-10?) and for 2010-11 showing under-paid tax. Total under-paid for the two years is £680. I have not checked the calculations yet.

They have sent a P2 coding notice reducing my tax code by 200 (ie an adjustment of £2000 to my tax-free allowance). Again I haven't checked the validity of this as it will be applied on a Month 1/Week 1 basis.

Instead of having the change to my tax-free allowance this year, can I not be allowed to simply pay whatever tax was underpaid in previous years and retain the 747L cumulative code?

your tax code will not have been adjusted at this stage in the year to collect tax that has been underpaid in a previous year.

On your P2, why has your code gone down?

If it is because of a benefit in kind you are receiving, then no you can not have the 747L cumulative code, the benefit should be taxed at the appropriate time, ie when you receive it.

antonic

They will be open again on Wednesday 28th Dec.

anamenottaken wrote: »

Thanks.

I expect they'll be open again before New Year.

anamenottaken

suso wrote: »

your tax code will not have been adjusted at this stage in the year to collect tax that has been underpaid in a previous year.

On your P2, why has your code gone down?

If it is because of a benefit in kind you are receiving, then no you can not have the 747L cumulative code, the benefit should be taxed at the appropriate time, ie when you receive it.

The tax code has been adjusted "547L, which replaces 747L". This is the 200 mentioned in post #1 and is being applied on a M1/W1 basis already as it is indeed a coding notice for tax year 2011-12 and my employer received the notification before I did.

The -£2000 adjustment can have no other reason than that it relates to the P800 calculations received the same day.

I have no benefits in kind, no taxable expenses, just one employer and one annuity. (The annuity has had BR deducted at source from around the middle of 2010-11.)

I shall check the 2009-10 and 2010-11 calculations and phone them in the week to request a voluntary payslip to clear the under-payment and so that I can return to 747L cumulative and enter 2012-13 without further adjustment (other than to 810L in respect of the increased personal allowance of course).

Mikeyorks

anamenottaken wrote: »

The -£2000 adjustment can have no other reason than that it relates to the P800 calculations received the same day.

Agreed it looks co-incidental. But a P800 underpayment will always be coded out the following year. Otherwise it leaves no window for appeal / voluntary payment etc etc.

P800Notes wrote:

If you owe less than £3,000 HMRC normally includes the underpayment in your tax code for the next tax year.

It appears as though they beleive the reason for the £2k underpayment is continuing during the current year

anamenottaken

Mikeyorks wrote: »

Agreed it looks co-incidental. But a P800 underpayment will always be coded out the following year. Otherwise it leaves no window for appeal / voluntary payment etc etc.



It appears as though they beleive the reason for the £2k underpayment is continuing during the current year

Thanks, Mikeyorks.

The annuity has been paid on BR basis since HMRC notified them back in late 2010 but, as this was non-cumulative, it led to an under-payment there.

I also don't know why the change has been made on a W1/M1 basis but see that they tried something like that in the autumn of 2010 too. (HMRC had reduced code to 139L as they erroneously assumed I was receiving state pension.) I had to sort that out too to get it reinstated to the proper cumulative code.

It's a bit annoying that they have gone back to 2009-10 for £320 but I know it is fair that this is paid. It's not my fault it wasn't deducted by the annuity provider as the scheme administration company had the facts of my employment.

It's not a £2000 underpayment but, they say, £680 over the two previous tax years.

suso

anamenottaken wrote: »

The tax code has been adjusted "547L, which replaces 747L". This is the 200 mentioned in post #1 and is being applied on a M1/W1 basis already as it is indeed a coding notice for tax year 2011-12 and my employer received the notification before I did.

The -£2000 adjustment can have no other reason than that it relates to the P800 calculations received the same day.

I have no benefits in kind, no taxable expenses, just one employer and one annuity. (The annuity has had BR deducted at source from around the middle of 2010-11.)

I shall check the 2009-10 and 2010-11 calculations and phone them in the week to request a voluntary payslip to clear the under-payment and so that I can return to 747L cumulative and enter 2012-13 without further adjustment (other than to 810L in respect of the increased personal allowance of course).

The P800 calculations have not led to your tax code being reduced , and as stated before no u/p will be introduced at this stage to your tax code.

The code will have been reduced to minimise any potential u/p in the current year,

If as you say you have no BIK or expenses payments, then there would have been a reason mentioned on the P2 notice of coding that explains why the code has been reduced.

Does your total income exceed the basic rate band, ie when you add your total taxable pay of your employment and annuity does it take you in the higher tax rate bracket? (over £42475 in the current year)

If so this would explain the u/p if the annuity is being taxed at BR, and there is is some higher rate tax due. It seems to follow a pattern.

the u/p from 9/10 was £320.00
the u/p from 10/11 was £360.00
giving you the P800 figure of £680.00

If your code has been reduced by 2000, then the predicted u/p if a 747L code had been used against your employment would be £400.00

anamenottaken

Thanks.

The reason on the coding notice is "you have had the benefit of too much tax free amount".

Any way, phoned this evening and think it will be sorted as they think I'll be earning more than I shall.