Two tax codes, HMRC wouldnt help

figgles

Hopefully someone can help here or at least give me some reassurance. In January I received 2 tax codes, one BR and one K1181 (yes, K1181, I've not mistyped that) which worried me. I have NOT changed jobs, got extra income, etc and have worked for the same company for over 5 years.

I phoned HMRC and they wouldn't do anything and said I'd have to speak to my employers which I did and they said that there were a few people who had had two tax codes sent to them for some reason so they were looking into it.

At the beginning of March my employer sent a letter to HMRC saying I didn't have two jobs and that I should have one tax code but I've not heard anything since then.

Yesterday I got my pay slip and have had double the amount of tax taken out than the previous month (exactly the same salary amounts, etc) which has left me out of pocket by a considerable amount.

It will be tomorrow morning before I can speak to my employer again (already emailed them all the details again) and maybe try HMRC again but I'm extremely worried about how long this could take to sort out and how long I'd have to wait to get my money back from the tax man as this could result in thousands of pounds in overpayment and I don't want to wait until next April for the repayments.

I'm not sure why this situation has arisen, as I've stated I have not changed companies for over 5 years and haven't had any kind of pay rise which could mean I'd owe huge amounts of tax!

So has anyone been in a similar situation and had this resolved quickly and painlessly or am I in for weeks/months of being out of pocket and getting increasingly angry with my employer and HMRC?

System

Do the 2 codes have the same PAYE reference number on them. They should look like 122/4567.

If they are the same then HMRC think you have 2 jobs with the one employer so the question to ask HMRC is what payroll number do they have for each source they have for you and confirm which is correct to them. HMRC would only have 2 sources in this scenario if either you or your employer sent them information with different payroll numbers. That usually happens when employers send in P14's at the end of the tax year and the payroll number does not match the one they put on the previous years P14.

If the PAYE reference numbers are different but the employer name is the same then your employer has had a scheme change - perhaps someone else took over the company but you and your colleagues remained in the same employment and nothing else changed. However in this scenario HMRC should have been made aware of the transfer of all the employees from the old scheme to the new one.

You need to clarify which is the case in your situation and get HMRC to correct your record with an up to date estimated yearly income.

figgles

Thanks for the quick reply. I do have two different references and the letters I got from HMRC had my old tax reference on listed as the one that should have the K code and the new tax reference (appearing on Aprils salary slip) as the one with a BR code.

I'm of the opinion it's some kind of HR / employer mess up but it's left me out of pocket and I'm not sure how long it will take to get my money back from HMRC.

Nothing has happened that I'm aware of that should change some kind of scheme change (not that I'd know if it was something internal) but even so they have allocated the wrong PAYE code to the wrong tax reference. The BR code would have been wrong too, but at least it would have been roughly right as opposed to me paying double the tax I should.

Hopefully my payroll department will sort this out quickly, but being out of pocket and potentially not getting the money back for a while (and indeed it possibly happening again in May, June, etc) is very annoying.

xylophone

http://www.hmrc.gov.uk/incometax/codes-basics.htm#3
Did you expect a K tax code?

figgles

No, I didn't expect any change. As per previous info, I've worked for the same company for over 5 years and haven't had any major job changes or pay rises which could warrant this.

Mikeyorks

figgles wrote: »

I'm of the opinion it's some kind of HR / employer mess up

This is the most likely. It looks as though your payroll people have created the impression within HMRC that you have more than one employment with them.

The K1181 Coding Notice surely suggests an income / previous year underpayment that has given rise to this? As we're into the new tax year your employer should be making a bit more of an effort to resolve? Push them.

xylophone

As you say - two jobs and £11810 (approx) to be added to his taxable income to take account of "excess untaxed income received."

It seems astonishing that HMRC refused the OP an explanation?

figgles

I phoned HMRC again today and after waiting about 45 minutes to get through I spoke to a guy who was incredibly helpful and said that it was a mistake and they have already sent a letter back to my employer on the 11th April saying that my tax code should be 810L.

My employers have already done the payroll run and I have to wait until someone else is in tomorrow to see what will be done now however as far as HMRC is concerned it should be 810L and (in my view) my employers are at fault now, so hopefully this will be put to bed soon!!!

xylophone

Glad it is on the way to a resolution!