Unknowing underpayment of tax

pjred

My wife has received a letter from HMRC saying that she has to repay the sum of £1512.40 in unpaid tax. This is calculated over a 4yr period.
At the time my wife was employed in two seperate part time jobs. One of which is a major Supermarket and the other a local Deli. Both jobs were legitimate, in the sense of that she was 'Cards in.' The miscalculation was not known by her, (How many of us know exactly how much to pay?)
Do we have to repay this amount seeing as it isn't my wife's fault? If not can someone please point us in the direction of what to do? This has been going on for over 12 months and now they want us (Wife) to arrange a repayment schedule. Also my wife now only works for the major Supermarket. What if possible is the minimum amount she can legitimately repay?
I look forward to your replies and assistance!

le_loup

Whose "fault" do you think it is?

chrisbur

In order to know what caused this error can you advise the details of gross earnings, tax paid, tax code and basis, for each job for each year affected? Also when the second job was started was a P46 completed and if so what section A, B or C was selected?

Chinkle

So if your wife had overpaid by the same amount would you be saying to the tax man "Oh well we didn't know, just keep the money"???

Your wife underpaid, it happens, she needs to arrange a repayment schedule which will most likely be done by readjusting her current tax code.

Most people find the tax system/codes confusing and just rely on their employers/tax office to get it right - but that isn't a defence if you haven't paid the correct amount.

The system is designed so both over and under payments are corrected and everyone pays exactly what is due.

CLAPTON

Chinkle wrote: »

So if your wife had overpaid by the same amount would you be saying to the tax man "Oh well we didn't know, just keep the money"???

Your wife underpaid, it happens, she needs to arrange a repayment schedule which will most likely be done by readjusting her current tax code.

Most people find the tax system/codes confusing and just rely on their employers/tax office to get it right - but that isn't a defence if you haven't paid the correct amount.

The system is designed so both over and under payments are corrected and everyone pays exactly what is due.

do you not think that esc a19 might apply here?
although without the full facts it's impossible to be sure

System

You wife has 2 options if she wants to appeal the underpayment.

ESC-A19 - where she states that HMRC were aware that she had 2 different employments and failed to issue the correct tax codes. HMRC would only be aware if your wife called them to advise that she now had 2 jobs or her second employer sent in a P46 to tell HMRC that she had started working with them. She should check with HMRC the date she contacted them or the date the P46 was received - the date would be on the notes on her record.

Employer error - This would be where HMRC issued a tax code to the new employer which they failed to operate correctly. If HMRC did issue a code then they would have sent one to her too and they would have expected her to see that her employer hadn't used it just by checking her payslips and inform them so they could reissue the code. If the employer received the code but failed to operate the code correctly according to the tax tables that would be their error.

pjred

My wife had been working in the Deli since 1994 and the Supermarket since 2000. If her tax wasn't being paid correctly then surely the underpayments would go back to at least 2001?

We (The lay people) don't understand the tax codes in this country on average, so therefore you would expect the offices that deal with your pay to get it right or am, I wrong?

00ec25

pjred wrote: »

My wife had been working in the Deli since 1994 and the Supermarket since 2000. If her tax wasn't being paid correctly then surely the underpayments would go back to at least 2001?

We (The lay people) don't understand the tax codes in this country on average, so therefore you would expect the offices that deal with your pay to get it right or am, I wrong?

sorry but ignorance of the law/system is not, and never has been, a defence. That line is naturally used when someone owes someone else, but rarely used when the other direction applies as people educate themselves on how to claim!

the fact HMRC have chosen to apparently only go back 4 years makes no difference to the fact that tax has been underpaid. they have possibly chosen 4 years to be kind to you since that is the maximum period they will now only allow if you want to claim off them

you need to answer Pam17's questions for us to help you with ESC19 - what has your wife told HMRC and when?
The P46 is central to this. I can sympathise that if she started the second job back in 2000 its unlikely she will remember but without proof you have a limited chance of appeal

chrismac1

I think a central issue is being missed here. Presumably these 2 employers have been filing end of year P14s for this person all this while, identifying her gross pay by her NI number. Can your wife confirm this - in other words has she been getting issued with a P60?

If so, then in any commonsense definition of "information" HMRC have had all the information they needed to get her tax right for as long as this has been happening. What was or was not filled in 12 years ago on a P46 is irrelevant as indeed it should be.

Granted, HMRC's silly Esc A19 rules do not count a P14 as "information". But in their current "we'll now move the goalposts in our favour" Esc A19 review this ridiculous definition of "information" is being challenged. Plus various Tribunals have ruled that HMRC are just taking the Mickey with this definition.

So it is Esc A19 and it will probably be 4 or 5 "box standard tell the taxpayer to get lost without reading the letter" rejection letters before you even get a half credible reply from them.

agrinnall

We'd have a much better chance of answering sensibly if you posted some figures - as is frequently stated on this board, tax is all about the detail. Presumably your wife has P60s and payslips from both employers, perhaps a good starting point would be the most recent year in which she had a P60 from both, posting all the figures from them (not forgetting Final Tax Code).

System

chrismac1 wrote: »

Granted, HMRC's silly Esc A19 rules do not count a P14 as "information". But in their current "we'll now move the goalposts in our favour" Esc A19 review this ridiculous definition of "information" is being challenged.

Have you read the full consultation document or are you just picking bits up from accountancy blogs? That's not rhetorical btw - I was going to ask you a question but it'll only make sense if you've read the full document.

chrismac1 wrote: »

Plus various Tribunals have ruled that HMRC are just taking the Mickey with this definition.

You've said this before, but the Tribunal Service has no jurisdiction over ESC A19.

http://eavesandco.wordpress.com/tag/esc-a19-tribunal/

You might be thinking of the Adjudicator's Office - but their remit is not the same as a Tribunal

http://www.adjudicatorsoffice.gov.uk/pdf/ao1.pdf

Quote:

Where it seems the organisation has applied its rules and
procedures correctly. The Adjudicator cannot ask the
organisation to modify its rules and procedures, no matter
how sympathetic she is to your situation.