PAYE coding notice. Can someone explain?

System

If you still have the coding notice showing the 1550L code take that to the Inland Revenue as proof and appeal the charge as Official error if it was their fault the wrong code was issued. If you can't do that you can asked for the underpayment to be spread over a longer period on hardship grounds.

downandout!

Hunted high and low for the coding notice but have come up dry. I have however found some wage slips. In Nov 2001 I have a wage slip with tax code 453LX. In July 2002 I have wage slips with tax code 461L and this continues until mid Nov 2002 when the tax code of 1510T appears.

All codes were whilst in the same job.

Why would the initial code have been LX?

Why would it change to 1510T after 1 year 2 months and would it seem likely they would have sent me details of why it was changing? (as I have pointed out I am sure I did receive a letter)

Should the IR be able to track down why the code changed and correspondence they sent?

As always, thanks for any assistance.

downandout!

ps: my youngest daughter was born in Sept 02 so would this have any bearing on things?

System

Since your child was born in Sept 2002 and your code changed in Nov 2002 I would assume they changed your code to give you Childrens Tax Credit for the 2002/2003 tax year and you would have received a Notice of Coding from them. That was the last year that CTC was given via a tax code it is now paid direct into an account of the primary carer.

I can't understand how they can say that they have no record of why your code changed it should be easily viewable on the coding summary screen for the 2002/03 tax year unless, and this is a BIG unless, for some reason your original computer record was lost and a new one was set up without the benefit of all previous history or, at the time, your tax record was set up under a temporary National Insurance Number. Have a look at some of your earlier coding notices to see what NI number was at the top.

If there is nothing wrong with the record then for the 2003/2004 tax year a new reduced code without CTC in it should have been issued automatically to your employer. Contact the Inland Revenue and ask them for a list of the tax codes issued by them from April 2002. If a reduced tax code was not issued by them for the 2003/04 tax year then you may have a claim for Official Error. If it was and your employer didn't operate it then your complaint is with them and they should be paying the underpayment.

Hope that helps.

BTW the LX is probably due to you starting work with the agency in Sept 2001 and not giving the agency a P45 from your previous employer so they couldn't operate a cumulative tax code.

downandout!

Thanks Pam,

Phoned them this morning and the lady on the phone still couldn't find any record of why my tax code changed. I explained that my daughter was born in Sept 02 and that I thought this might have been the reason. She agreed this would have been the case but that they had no record of any CTC given to me. The whole upshot means I have paid an underpayment for 02/03 of £700 odd quid and I shouldn't have. The underpayment for 03/04 of £1128.58 remains however as they sent me notice that my tax code should be 461L in Jan 03 (they probably did but I don't have it) and they say I should have informed my employer of this.

Anyway she is sending me some sort of form with regards to the 02/03 tax. She has taken the £700 odd away from the £1128.58 and said I will pay the £350 approx difference over the next 12 months and by April next year all will be well.

Not ideal as I still owe some, but a damn site better than it was. I was kicking myself for getting in this mess when my OH pointed out that my daughter that was born in Sept was 2.5 months premature and was in hospital for just under 3 months in an incubator, and my OH, who had severe pre-eclampsia, took an eclamptic fit 3 weeks after the birth and was pretty unwell for a while at the time all this would have been happening.

Thanks a million all who have replied and given me some understanding of how to tackle this and saved me almost 1k in tax repayments. :beer:

downandout!

System

I'm glad to see you managed to get some of it sorted anyway.

Paul_Varjak

Was your tax code 1510T or 151OT? The difference being a letter 'O' rather than the digit '0'. Perhaps there was some error made by your employer in transcribing the tax codes into their records so you got a tax code of 1510T rather 151OT so you did not pay any tax!

OT is a tax code used when you have a second job and indicates that all of your allowances have been applied in the tax code applied to your first source of income. If you did not have a second job at the time, maybe that is another another problem to sort out!