Who assigns tax code for employee?

csh_2

Hi, was wondering if anyone could clarify this for me:
My daughter started work at her first job on 22nd March and is paid weekly. She filled in a P46 when she started.
Her tax code on her wage slip is still 0T meaning she is being taxed on all her pay at 20%.
She asked he employer why she was on emergency tax and they said its nothing to do with them and it was up to HMRC to change the code but I always thought that the employer assigned the code in the first instance relative to employment situation.
I had a look on the HMRC website and downloaded a starter checklist for her to give to her employer (basically the same as a P46) but after googling read that her tax code can only be changed as directs by HMRC but their own web site states that the 'starter checklist' should not be returned to them only the employer.
Her employer is not very helpful and don't seem that interested in resolving the issue for her.

Thanks for any help offered, sorry about formatting, I'm on the phone!

zygurat789

The employer can not resolve the issue for your daughter without breaking the law. An employer has to use the tax code given by HMRC.
In the absence of any other cde information a new employer is authorised to use an emergency code which would be 944L W1 (or M1). 0T is not emergency tax, it's far worse.
If the employer won't cooperate the only course of action is to contact HMRC, you will need your daughters NI number and it would help if you had her empoyers reference.

Nicola_Ed

Hi

The extract from HMRC website (below) states that your employer will initially allocate a tax code based on the information provided on the checklist/P46 and that HMRC may subsequently revise the code if, from the information they have, they consider that the code is wrong. (HMRC are likely to have more information than is declared on the checklist) Employers are not responsible for tax codes being accurate and are unlikely to get involved in any discussions of this nature ( it is not their responsibility) Your daughter should call HMRC ask them to amend the code and explain why she thinks this is wrong.

Starter Checklist

If you don't have a P45 because, for example, you're starting your first job or taking on a second job without giving up your other one, your new employer may give you a 'Starter Checklist' to complete. It contains important information that affects the amount of tax you’ll pay, such as whether:

• this is your first job
• you've been claiming Jobseeker's Allowance or Employment and Support Allowance
• you've got another job
• you're paying off a student loan

The Starter Checklist replaces form P46. The checklist will ask you relevant information before your first payday to tell HMRC about you. It will help your employer to allocate a tax code and work out the tax due on your first pay day. HMRC will process the information you have provided on the Starter checklist and where necessary revise your tax code. It's therefore important that you complete the 'Starter Checklist' or provide the relevant information your employer has asked you for as soon as possible before your first pay day, so your employer knows what tax code to use. You can complete and print a copy of the Starter Checklist by following the link below. Give it to your employer, do not send the checklist to HMRC.

csh_2

So what is code 0T and why has she been given that?
Is there any point in her handing in the 'starter checklist' or should I bypass the employer and go straight to HMRC?

Thanks for the help

Nicola_Ed

Without knowing if the OT was correctly allocated (based on the P46 responses) or was allocated my mistake, my advice would still be to call HMRC and ask them to issue a correct code.

jem16

csh wrote: »

So what is code 0T and why has she been given that?

0T means that you daughter is being given no personal tax-free allowance and that everything is being taxed at 20% or above depending on how much she earns.

Code 0T is normally issued in the absence of either a P45 or P46 or because the employee hasn't completed Section 1 of the P46.

http://www.hmrc.gov.uk/forms/p46exemptonline.pdf

Is there any point in her handing in the 'starter checklist' or should I bypass the employer and go straight to HMRC?

Thanks for the help

Personally I would get your daughter to phone HMRC. They will not speak to you without speaking to her first.

csh_2

Ok I'll do that tomorrow then thanks.
She defo ticked 'this is my only job' bit on the form Section A as I told her which one to do.
It's a right PITA as its a rotten job she is doing with awful hours for minimum wage of £3.95 ph then she's loosing loads in tax!
Hopefully they can sort it quickly

jem16

csh wrote: »

Ok I'll do that tomorrow then thanks.
She defo ticked 'this is my only job' bit on the form Section A as I told her which one to do.

Well unless she didn't do it correctly or it's not been actioned then it should have been 944l which was allocated.

Make sure she phones or you're wasting your time.

John_Pierpoint

The employer is playing safe, from their point of view.

What job is she doing?

Would it be the sort of job where her fellow transient employees might be tempted to lie in order to maximise the size of their wage packets?

Something similar happened to my daughter, when she was a school girl.
In those days she had a job that she took seriously, because her skin flint father refused to finance her "fashionable" non utilitarian expenditure.
Her employer was Trust-Houses-Forte, in those good old days of full employment, she simply ticked and signed a form saying "I am a student" and got paid gross.
Then her employer was taken over by Granada and she found herself in the same sort of situation as your daughter.
When we telephoned the tax office of Granada and started to try to explain the problem - an exasperated officer, cut me short with "Are we talking about Granada" (sigh).

Well changes in the tax system, like student loans and computerisation, have not been used as an opportunity to simplify it, much the reverse.

All good education for for your daughter though - perhaps it is time for her to stand on her own feet and post on here?

dzug1

stablesoft1 wrote: »

I am get a warning "You must assign a Sales Tax Code to this line item. I have no taxable items and I do not see anywhere to assign a tax code to an item or customer. I cannot create an invoice without doing this.

www(dot)stablesoft-europe(dot)com

This thread is nothing to do with sales taxes - maybe you should start your own thread with a different subject.

And explaining your question a little more clearly would help. If indeed it is a question and not an advert for stablesoft

CLAPTON

csh wrote: »

Hi, was wondering if anyone could clarify this for me:
My daughter started work at her first job on 22nd March and is paid weekly. She filled in a P46 when she started.
Her tax code on her wage slip is still 0T meaning she is being taxed on all her pay at 20%.
She asked he employer why she was on emergency tax and they said its nothing to do with them and it was up to HMRC to change the code but I always thought that the employer assigned the code in the first instance relative to employment situation.
I had a look on the HMRC website and downloaded a starter checklist for her to give to her employer (basically the same as a P46) but after googling read that her tax code can only be changed as directs by HMRC but their own web site states that the 'starter checklist' should not be returned to them only the employer.
Her employer is not very helpful and don't seem that interested in resolving the issue for her.

Thanks for any help offered, sorry about formatting, I'm on the phone!

Sadly many employers (especially smallish companies) have no idea about tax.

She must speak to HMRC asap so her tax code can be corrected and also to claim the back tax for last tax years.