Is hubby due a tax rebate?

Shazza50

Wondering if hubby is due a tax rebate. Up until July last year he was receiving Incapacity benefit and he also has an occupational health pension from a previous employer, on which he was taxed, because I presume of the combined IB and pension. He has received a new tax code for April which says that he can receive £790 pension per month before any tax is deducted. My understanding is that the tax code has changed because he no longer receives IB. His pension is about £700 before tax. So as he was still paying tax of £100 per month from his pension from August to March, and not receiving IB, is it likely he will receive a tax rebate?

Dazed_and_confused

Possibly, you need to post the P45 details from the incapacity benefit and P60 details for the pension.

Did he start getting employment support allowance or state pension incapacity ended?

What tax code was used against the pension last year?

Shazza50

I haven't got the p45 details to hand for the IB just now. The only income he has had since July 2012 is the occupational pension. Last years tax code was 244L and the new one is 944L. Haven't yet received the p60.

Dazed_and_confused

Shazza50 wrote: »

I haven't got the p45 details to hand for the IB just now. The only income he has had since July 2012 is the occupational pension. Last years tax code was 244L and the new one is 944L. Haven't yet received the p60.

If the 244L code was down to the fact that the code included a deduction for a years worth of IB (approx 5660) and he only received 3 or 4 months worth of IB then yes a refund sounds as though it is due.

Your OH will get it automatically but you might get it quicker by sending his P60 and copy of IB P45 with confirmation no other income was received in year to 05:04:2013 to Hmrc.

Once you find P45 if you post figures from this the P60 and details of how the 244L code was calculated it should be possible to calculate what the refund will be.

Shazza50

Ok, we now have the P60 from the pension and P45 from IB.
P60 figures are Pay = 8460.24
Tax deducted =1202.20
Final tax code 244L

P45 figures are Pay =1464.02
Tax = 0
Tax code at leaving 810L Leaving date 9/7/12

Tax code 244L was worked out as follows
Personal Allowance = 8105
Taxable IB =-5665
Tax free amount = 2440

I will just add that this means absolutely nothing to me, especially where the two tax codes are concerned .

CraigR

Tax codes are pretty immaterial when it comes to calculating if a refund is due from a previous year, they are useful for explaining why you may have paid too much or too little tax but its the pay and tax details that give the answer:

Right income was £8460.24 + £1464.02 = £9924.26
Taxable pay: £9924.26 - £8105 (Personal Allowance) = £1819.26
Tax due: £1819.26 @ 20% = £363.85
Difference between tax paid and tax due: £1202.20 - £363.85 = £838.35

Therefore you are due a rebate of £838.35 (assuming there was no other income). To get the refund you can do nothing and HMRC should send it out to you a month or so, or you can send in the P45 and P60 details and they will process it within 5 weeks.

Dazed_and_confused

Shazza50 wrote: »

Ok, we now have the P60 from the pension and P45 from IB.
P60 figures are Pay = 8460.24
Tax deducted =1202.20
Final tax code 244L

P45 figures are Pay =1464.02
Tax = 0
Tax code at leaving 810L Leaving date 9/7/12

Tax code 244L was worked out as follows
Personal Allowance = 8105
Taxable IB =-5665
Tax free amount = 2440

I will just add that this means absolutely nothing to me, especially where the two tax codes are concerned .

Basically your OH has been taxed on his pension as though he was getting Incapacity Benefit all year but as the IB ended in July he has been paying too much tax because the tax code 244L was not changed to take into account the IB has stopped.

As CraigR has calculated he is due a decent refund but I think you'd be better off claiming this back (send P60 and copy of P45 (part 1A) with confirmation no other income was received (why didn't OH get ESA or State Pension after IB stopped?)). You would get it back eventually anyway but why wait - might be 5 months rather than 5 weeks if you ask for the refund yourselves.