P11D & Underpaid Tax Query

mgh153

I have just has a letter from the IR saying I have unpaid my tax for 04/05 by £1500 ish, it seems that the expenses I claimed back from the employer ie taxis, mobile calls, postage, odd bits of stationary have been included on my P11D and are classed as a taxable benefit. Is that right ? Surley if I incurred these costs on behalf of the employer carrying out my work then I shoudn't be taxed on it as it wasn't a benefit... I also have also been taxed on £1900 worth of medical insurance even though the annual premium was only £1000 - would I have been taxed on the actual treatments I recieved under the policy?

Please, any advice grateful as I really can't afford the underpaid tax, I no longer work for the employer but am on good terms, have a similar problem with the P11D for 05/06 too.

Thanks

jennifernil

Did you claim these expenses on your tax return? Where expenses you are paid are on your P11D you need to put them on your return under income and then claim them back again. If you don't claim you won't get.
As for the medical insurance, I would have expected only the premium paid by your employer to be taxed, again this should be declared on your return.

mgh153

Thanks for the advice. I have never been asked by the IR to fill in a tax return, can I do one retrospectively ?

jennifernil

Yes, ring them up and ask for the correct forms. You will need one for each tax year you are covering. Ask them if you can do the short return, but as it is your first they may insist you do the full one. Don't worry, a lot of it will not apply to you, it just asks for a little more detail.

If you have tax to pay, I think it is easier to check you pay the correct amount if you request to pay it separately (if you have the cash), otherwise they will alter your code number and collect it through PAYE, so I feel it becomes quite complicated.

If you are no longer receiving these expenses/benefits, be sure to attach a letter telling them that , or they will assume you are and alter your code number accordingly.

barvid

> I also have also been taxed on £1900 worth of medical insurance even though the annual premium was only £1000

You're taxed on the VALUE of the benefit, not necessarily what you pay for it (e.g. if it's subsidised).