HMRC Reducing My Tax Free Allowance for Business Expenses

marcjames

Hi All,

I had a letter last year from HMRC that I lost. It was along the lines that I had not paid enough tax for the tax year 2010-2011, to the figure of £207.

My work manage my tax payments through PAYE so I assumed that an error had been made.

I just received another letter from HMRC detailing the underpayment of tax and that they are now reducing my tax free allowance by circa £1,000 to pay the £207 back.

I spoke with my company to ask why they had underpaid my tax, but they said that I haven't and that the issue is likely the result of my business expenses being listed as benefit expenses on the P11D. My company said that there is no way for them to say that one receipt/entry is non-taxable when entering the figures online. If they don't enter the expenses then they get fined.

I spoke with HMRC and they confirmed that their records state that I received benefit expenses and not business expenses (which they were).
They asked me to send off my P11D to prove it.

I've never received a P11D, but I've asked work for a copy. They are sending me an export that they imported into the online system. What else do I need to send to prove that I shouldn't be paying taxes on my business expenses?

I appreciate any guidance or help with this matter.

Thank you.

Xutl

marcjames wrote: »

Hi All,

I had a letter last year from HMRC that I lost. It was along the lines that I had not paid enough tax for the tax year 2010-2011, to the figure of £207.

My work manage my tax payments through PAYE so I assumed that an error had been made.

I just received another letter from HMRC detailing the underpayment of tax and that they are now reducing my tax free allowance by circa £1,000 to pay the £207 back.

I spoke with my company to ask why they had underpaid my tax, but they said that I haven't and that the issue is likely the result of my business expenses being listed as benefit expenses on the P11D. My company said that there is no way for them to say that one receipt/entry is non-taxable when entering the figures online. If they don't enter the expenses then they get fined.

I spoke with HMRC and they confirmed that their records state that I received benefit expenses and not business expenses (which they were).
They asked me to send off my P11D to prove it.

I've never received a P11D, but I've asked work for a copy. They are sending me an export that they imported into the online system. What else do I need to send to prove that I shouldn't be paying taxes on my business expenses?

I appreciate any guidance or help with this matter.

Thank you.

If they are on the P11D then you are likely to be charged tax on them. Just a thought - Why don't you claim tax relief against the business expenses on a form P87. That way the charge and the relief would cancel each other out?

Read more here.

ioscorpio

It does not cancel out the extra NI deducted. I have a similar problem whereby I have tax and NI deducted from my business mileage, I am trying to sort it out with the tax office at the moment.