Random money and what to do with it!

Wellyboots6

Hi all,

I have a question that I think I know the answer to, but thought I would ask you good people anyway as I don't trust my own judgement!

I filled in a self-assessment tax return recently with estimated figures as the paperwork I needed got lost when I moved house. The estimate came out that I was owed over £2000 in tax. I made sure I made it clear on the tax return that these were estimated figures. I also made a note on it that I have not been self-employed for about 3 years now.

Yesterday I had a letter through saying that after next year I wont need to complete a self-assessment tax return, so they had obviously read the notes I put on it.

Checked my bank balance today, and there was a payment from HMRC for the amount that the self-assessment suggested they owed me. Bit of a shock!

Now... I am not silly enough to think that the money is actually mine, as it was worked out with estimates and not actual figures.

My question is, how will they demand the money back, and when?

If it won't be until next year, due to my debts is it worth me using this money to pay off my £900 overdraft as that is charging me interest and fees, and then to put the money to one side that would have gone on overdraft payments to repay the tax bill?

I'm not entirely sure how this all works, I have only ever owed them money!!

Thank you in advance

DVardysShadow

Missing information: How much of that money you estimate is definitely yours and does not need paying back?

I suggest you take £1000 and add it to your current account- and remember to keep this account always in the black from now on, otherwise you are living beyond your means. And the other £1000 i would pay off my highest APR debt if I could be sure I could get £1000 back off my cards on a time scale acceptable to HMRC - by transferring expenditure to card and paying HMRC from the surplus arising in the current account. Failing that, £1000 into a high interest account.

Wellyboots6

I am guessing that none of it is mine. I would rather look at it that way to avoid any nasty shocks later on.

I have no cards (finally!) or access to a high interest account. The only account I have is my basic current account and an online savings account that pays 3% interest but only if I pay in less than £250 a month.

I don't trust myself just yet to leave the money in my current account as it would be too tempting to spend it.

Currently I owe my parents A LOT, and I have an overdraft that needs clearing (see my sig). My thoughts were if I could pay off my overdraft with some of the money, and then use what I would be paying towards my overdraft to top up what I used ready for when they claim the money back. Only I don't know how to do this without having access to the money to spend it!

Oneday77

If you owe the OD then pay it off and request it is removed.
Then give the balance to your folks as you owe them. You could say it may be asked for back but only if the HMRC Send you a letter. It shows them that your giving them any free cash when you can even if it is unexpected.

Skint_yet_Again

katy721 wrote: »

Hi all,

I have a question that I think I know the answer to, but thought I would ask you good people anyway as I don't trust my own judgement!

I filled in a self-assessment tax return recently with estimated figures as the paperwork I needed got lost when I moved house. The estimate came out that I was owed over £2000 in tax. I made sure I made it clear on the tax return that these were estimated figures. I also made a note on it that I have not been self-employed for about 3 years now.

Yesterday I had a letter through saying that after next year I wont need to complete a self-assessment tax return, so they had obviously read the notes I put on it.

Checked my bank balance today, and there was a payment from HMRC for the amount that the self-assessment suggested they owed me. Bit of a shock!

Now... I am not silly enough to think that the money is actually mine, as it was worked out with estimates and not actual figures.

My question is, how will they demand the money back, and when?

If it won't be until next year, due to my debts is it worth me using this money to pay off my £900 overdraft as that is charging me interest and fees, and then to put the money to one side that would have gone on overdraft payments to repay the tax bill?

I'm not entirely sure how this all works, I have only ever owed them money!!

Thank you in advance

Sorry can't help much but HMRC will expect you to provide actual figures & pay back any amount repaid to you in error. They may charge interest. You may get a better idea of when this is likely to be & when you will need to pay back if you post on the "Cutting Tax" forum

mrsb83_2

You need to contact HMRC directly. They may have accepted your figures and your explanation for the lost documents, or they may require you to submit further information.

I would do nothing wit the £ without speaking to them and getting written confirmation of the position.

Wellyboots6

I have done nothing with the money yet.
Should I contact them first then or wait for them to contact me?

I wish they hadn't sent me the money, its causing me so much worry!!

mrsb83_2

Contact them! Why wait for them to get in touch with you? They might not.

You need to establish what, if anything, they intend to do about the estimated return.

Wellyboots6

My parents are pushing for me to use the money to clear my overdraft.

I am struggling now because I would feel so much better seeing what needed returning and sending it back before I got tempted to use it. I also feel I have to go with what they say because I owe them so much money (see my sig).

welshone27

Personaly I'd phone them. The worry of waiting for them to contact me would be not worth it.

Wellyboots6

I think I will ring them tomorrow. Not sure what to say other than 'thanks for the money but I don't think you should have sent it me!'