Tax Code Changed ??

southwester_2

Hi

I have been on a tax code of 652l but have just received my P60 and been told by personnel that my tax code is changing to 444L.

I rang the tax office who confused me evn more but I also claim mileage allowance relief, I get paid 24p to the mile, where I am entitled to 40p for the firstr 10,000 miles. The previous year I did over 10000 miles but last year I only did 6600 miles.

The tax office said that my tax code would change again once my P11D had come in from my employer for the year 2007-2008.

Is this correct.

Thanks

dgncl

Hi Southwester, the standard tax code is 522L for the 2007/08 tax year, giving you a tax-free limit of £5225 this year. Any deviation from this tax code will be due to benefits you get such as car allowance, mobile phones et cetera, or tax you owe HMRC or are owed for previous tax years.

Every year your employer will submit a P11D (by July 2007) which states all benefits and expenses you have received and what they consist of. From this the HMRC will work out your equivalent salary. Let's say somebody else gets the same salary as you but doesn't get a car, phone etc - it would only be fair for you to be taxed more for your extra benefits.

The HMRC will take the P11D into account and send a P9 to your employer and a letter to yourself, with the new tax code and why it is as it is. Make sure you get this and keep hold of it as you can use it to check that you are on the correct tax code.

All the best,

DG