Can anyone help regarding a tax code query?

THEONLINEGEEKGAL

Hi all

Does anyone understand tax codes?

My brother is single and works full time. I presumed his tax code would be 747L as he has no other job, no work benefits etc but tonight he told me his code is 762L...surely this is wrong? Although he is single he does claim tax credits as part of a couple and gets child tax credit for 2 children.

Does anyone have any ideas?

It looks to me like he might owe the tax man money

From what he has told me his tax code for at least the last 5 years has been £150 more than the basic rate meaning he can earn £150 more before paying tax but we cant see any reason for this?

Can anyone shed any light?

McKneff

He should ring HMRC and ask. He should have had paper work from them anyway to say how they have calculated it.
He is obviously being allowed for something,

Valli

maybe he gets extra allowance for laundering clothes or something? But he should have had a notice of coding...

McKneff

Hey, Valli, :wave::wave:

Happy New Year, hope your doing well

THEONLINEGEEKGAL

Hi guys

Thanks for your replies.

I have just asked him and apparently he hasnt had a coding notice sent to him since tax year 2004/2005 and on that coding notice it showed he was getting the basic personal allowance but from that year onwards is when he saw his p60 from his employer had his tax code at £150 over the basic rate?

McKneff

HMRC it is then

Mikeyorks

THEONLINEGEEKGAL wrote: »

had his tax code at £150 over the basic rate?

So he is paying £30 less tax per annum than if the £150 was not there? Which isn't going to break the bank if it's wrong?

However - unlike HMRC to add allowances for no reason. Equally unlikely for them to do so with no notification whatsoever? Perhaps he should contact them.

THEONLINEGEEKGAL

Bro telephoned HMRC and enquired about the £150 allowance (£30 a year in real money lol) and they advised him that since 2004 they have been sending coding notices to his employer stating he should be on the basic which is 747L this tax year and that his employer is obviously giving some sort of allowance without HMRC knowing what. They said it is defo not clothing allowance as the figure does not add up. They were unable to say what it was for and told my bro to ring his employer on Tuesday and ask them what it is.

Apparently HMRC are aware that my bro is underpaying tax each year but it apparently falls under the tolerance level each year so they do not persue it!!!! Even if you add it up over several years they told him they will not persue it as £30 a year is under the tolerance and will cost more to try to recover it.

So....should he bother even trying to find out what it is as the taxman wont be claiming it back anyway?

xylophone

Yes - HMRC might not always be so tolerant!

Savvy_Sue

And another yes, because if the employer isn't following HMRC's instructions re coding allowances, I'd wonder what else they were getting wrong and this might encourage them to get things right in future!