Company car back tax (possible to clear)?

natanddan1

Thought i would mention this to all others who may be experiancing the same issues.

A colleague of mine has been hit by the taxman with regards to back tax on a company car! Although he has sent in his tax returns and the company have issued the P11d's (he is PAYE) they have refused to adjust the tax code for the last 4 - 5 years.

Apparently, there is a clause (Extra statutory clause A19) that states the IR have a duty to adjust the tax code once in receipt of information within a reasonably prompt period! If this has not been done, you can write to your tax office and ask for the back tax to be written off under this clause (A19).

Would be interested to hear from anyone who has done this or knows how likely it would be to get this clause administered.

Gray0103

I did this as my first company car was a hired Vectra, so that was the info on my P11D in 2002/3, which was then amended by my then empolyers, but not amende dby HM Revenue, in actual fact I only had the Vectra for 2 weeks untill my 307 was ready.

HMRevenue taxed me for this Vectra for 12 months, and I have been fighting it since, this had led to on average 4 tax code changes per year as the revenue chased their short fall.

Finally after 3 job changes and 4 years I got the matter resolved this year, and a cheque for £28 for an over payment.

Just make sure your friend has all their P11D's and P60's and then get them all together and make a claim

Hoddie_2

natanddan1 wrote: »

Thought i would mention this to all others who may be experiancing the same issues... ...Would be interested to hear from anyone who has done this or knows how likely it would be to get this clause administered.

If you're completing tax returns (correctly) then the tax due on the benefits would have been collected through your SA account, regardless whether your code was adjusted or not.

natanddan1

Hoddie wrote: »

If you're completing tax returns (correctly) then the tax due on the benefits would have been collected through your SA account, regardless whether your code was adjusted or not.

sorry but i'm not with you. the colleague filled in the self assessment form each year even though he is PAYE. He highlighted the fact he ran a company car. The P11d and other documentation from the company also detailed the company car etc.

Surely, if you are a PAYE, then your tax code should be adjusted to make allowance for the benefit?

According to TAXAID.co.uk the IR did not act within a reasonable time scale (4 years) and so they should write off the tax under clause A19.

What i am asking is has anyone else done this.

Hoddie_2

But if someone is within the Self Assessment system, the point at which they could use the legislation you're talking about will never be reached. Someone completing SA returns would (normally) need to file no later than 10 months after the end of the tax year in question, and it is their responsibility to declare the benefits as stated on the P11D - which in turn collects the tax due if the benefits were not included in the code.

Yes, I imagine many thousands of people have had tax liability written off using this method, but I expect very few of them were within the SA system.

natanddan1

thanks for that, are you saying that if you have never filled out a SA return then the clause would most likely be able to be used. If i understand correctly, if the IR send you a tax return form then they are at liberty to claim the benefit tax this way instead of through the tax coding?