Asked to repay tax rebate, can I refuse?

abbicox

I received a tax rebate a few months ago for £650 as I had been on the wrong tax code (was 747L, it has now been corrected to 810L) for the first few months of my job.

I cashed the cheque and thought nothing else of it, until I received a letter saying I owed the £650 back as I had actually been paying the correct tax all along even though the code was wrong.

I called the tax office to check this, and they said it could be my employers fault for not notifying them with my P45 details (which I gave to work as soon as I began), or it could be an error at the tax office end.

He said I will have to repay it over the course of next year's tax, but it seems unfair as I was given the rebate through no fault of my own.

Does anyone have any advice?

I'm new to posting so sorry if I'm in the worn category!

Thanks,

Abbi.

Meadows

As the Tax people say the onus is always on you to ensure you pay the right tax, did you calculate that you were owed a tax refund or just assume it was right?
Either way you received money that was not due and now it must be paid back either as a lump sum or through your tax over the coming year.

Horseunderwater

The first thing I'd say is when did you leave one job and begin the next one? Different tax years perhaps? The next thing I'd ask is Were your earnings over £7475 last year? If yes, then you do owe them the repayment. Everybody has a basic tax free amount that they can earn each year. Last year it was the aforementioned amount and this it is £8105. Of course some people, have things like 2nd jobs, self employed income, investment income, pensions etc added or subtracted from their tax free amounts(codes). So they could be paying more or less tax than the basic mentioned above.
So if your earnings were more than £7475 last year, you have to pay it back and spread over a year it is not too much extra per month £54.20 approx extra tax a month to cover it. Hardly noticable.

pickpocketlocket

If the overpayment is correct, if you refuse to pay all they'll do is adjust your tax code to recoup the money.

abbicox

Thanks for the advice, I shouldn't have assumed it was correct I suppose! I'll be checking more thoroughly next time x

dori2o

abbicox wrote: »

I received a tax rebate a few months ago for £650 as I had been on the wrong tax code (was 747L, it has now been corrected to 810L) for the first few months of my job.

I cashed the cheque and thought nothing else of it, until I received a letter saying I owed the £650 back as I had actually been paying the correct tax all along even though the code was wrong.

I called the tax office to check this, and they said it could be my employers fault for not notifying them with my P45 details (which I gave to work as soon as I began), or it could be an error at the tax office end.

He said I will have to repay it over the course of next year's tax, but it seems unfair as I was given the rebate through no fault of my own.

Does anyone have any advice?

I'm new to posting so sorry if I'm in the worn category!

Thanks,

Abbi.

Can you confirm.

Who issued the cheque?
Did you receive a calculation?
When did you leave your previous employer?
When did you start your new employment?
Have you filled in a form P50, or sent a letter to HMRC, with your P45 asking for a repayment for the current tax year?

abbicox

Hi dori2o,

Who issued the cheque? I was sent it through the post from HMRC

Did you receive a calculation? Yes that calculation was fully listed with all the workings out.

When did you leave your previous employer? I left my previous employer in Oct 2011.

When did you start your new employment? Started with new employer immediately after in Oct 2011.

Have you filled in a form P50, or sent a letter to HMRC, with your P45 asking for a repayment for the current tax year? I haven't done this, the only thing I have done is give my new employer my P45 when I started employment and they advised me that they would sort everything out.

Thanks x

Dekota

You gots to pay it back Im afraid, HMRC is the rottweilers of the big bad boys.