Friend, 1, being taxed but not yet earned £7k?

bob_dob

Hi,

My friend is on a training scheme with his employer and has yet to earn even £7000 since the last tax year. He is paying tax and NI, is this right please?

Thank you.

itch_for_a_glitch

http://www.hmrc.gov.uk/rates/nic.htm

NI is paid weekly on earnings over £107 for most folk, does he have a tax code ?

Funky_Bold_Ribena

It is not, no.

CLAPTON

maybe give some more details

-what has he done since April work/income wise

-what is his tax code

bob_dob

Thank you, all.

He turned 18 in December, his employers started paying him the applicable rate when he came back to work after the Christmas break and:
His tax code is: 810L M
His total gross pay so far is: £6859
He was taxed £28.40 this month
The total he has been taxed up to now is £109
His NI this month is £22.08
Total NI so far is £86.88


Does this help, please?

molerat

bob_dob wrote: »

Thank you, all.

He turned 18 in December, his employers started paying him the applicable rate when he came back to work after the Christmas break and:
His tax code is: 810L M
His total gross pay so far is: £6859
He was taxed £28.40 this month
The total he has been taxed up to now is £109
His NI this month is £22.08
Total NI so far is £86.88


Does this help, please?

This is the problem, his tax is being calculated on a monthly stand alone basis and not cumulative. A bit late to do anything about it this year but when he gets his P60 he needs to contact the tax office to get a refund. Has he received a P2 for next FY, if not may be worth contacting the tax office to ensure the M is taken off. The NI is calculated on each pay packet so does not have a cumulative threshold.

bob_dob

Thank you, can I ask exactly how he can phrase his complaint/request?

chrisbur

molerat wrote: »

Has he received a P2 for next FY, if not may be worth contacting the tax office to ensure the M is taken off. The NI is calculated on each pay packet so does not have a cumulative threshold.

There is no need to contact the tax office to get a month 1 basis removed, employers are under instruction to convert all non-cumulative codes to cumulative when they carry them forward to the new tax year.

bob_dob

chrisbur wrote: »

There is no need to contact the tax office to get a month 1 basis removed, employers are under instruction to convert all non-cumulative codes to cumulative when they carry them forward to the new tax year.

So his employers should refund him?

MPH80

No - that will just solve the problem for next year.

A tax code just tells the employer how much tax to take each month.

Once the money has been taken and is on a payslip, he'll need to go to HMRC to get it back.

He needs to send a copy of his P60, explain that he earned under the personal tax threshold and request a refund.

If I were him - I'd specifically ask for a bank transfer and give the account details - otherwise they may adjust his tax code to refund him slowly back over the following year.

jem16

MPH80 wrote: »

Once the money has been taken and is on a payslip, he'll need to go to HMRC to get it back.

Normally no you wouldn't have to do this as any tax refund would be handled through your pay once the correct cumulative tax code was used.

However in this case there is not enough time for this to happen as we're too close to the end of the tax year.