HELP understanding new tax code

Jude8111

Now pulling out my hair!! Received tax letter and it seems wrong called office even more confussed!!

My Personal Allowence £9440
Medical Insurance. -£432
Outstanding Debt Restriction -£5669. -£6101
A tax free amount of. £3339

Tax code 333L

You owe £1133.94 overpaid tax credit (dispute pending) we have written to you before to pay this amount we told you that if you did not pay than we would collect it by adjusting your tax code we have reduced your tax-free amount by £5669.00 to collect the tax due we expect you to pay tax this year at 20% on an extra £5669.00 (£5669 at 20% is £1134.94)


This is what was received it just seems a big drop in my personal allowence are the figures right?

nomunnofun

A first for me this! I have never come across tax credit overpayments being collected through tax codes before,

Basically you will be paying about £95 per month extra in tax for a year to collect the amount due. Is the dispute likely to end up in your favour? It seems a bit much for HMRC to collect what they perceive to be correct before the dispute is settled one way or the other.

Jude8111

Apparently they can collect through pay or i pay them monthly just trying to work out whether they can have £30 a month for a few years or pay off in the year... You never win a dispute but ifa miracle happens they will pay e back that would be the day!! I was just worried as there is a massive drop in my personal tax free bit for owing jst over 1k x

agrinnall

I'm not sure what you think might be wrong about the figures, they are trying to collect an overpayment that you have already refused to pay by any other method, so your personal allowance has been reduced by an amount such that the extra tax paid equals what you owe. I have no idea whether they will now enter into negotiation about an extended payment period, it's probably worth a try but it wouldn't surprise me if they stick to their guns, unless you can show that it'll cause you extreme hardship.

dtaylor84

Jude8111 wrote: »

I was just worried as there is a massive drop in my personal tax free bit for owing jst over 1k x

They have explained how they calculated it:

we have reduced your tax-free amount by £5669.00 to collect the tax due

we expect you to pay tax this year at 20% on an extra £5669.00

(£5669 at 20% is £1134.94)