Tax office saying underpaid tax yet again. Correct?

JustAnotherSaver

jimmo wrote: »

The State Benefits of course remain the main issue so your mum still needs to ask HMRC about that. Legend has it that phoning HMRC as near as possible to 8.00 am is the best chance of getting through to a human being in a reasonable time. I can only say that it worked for me on the one occasion that I have needed to phone HMRC.

I'll go over the IB again to see if i've made a mistake.

However the above quote - i've already told her she needs to be on at them tomorrow to find out what this extra income is. I wonder whether they'll be able to tell her exactly the source of this money, but she can at least try & ask.

twig1_2

Have had similar problem with a relatives tax.
From your scans it appears that the revenue think your mum will receive for 2013/14
Esa (taxable) 2863
Incapacity benefit(taxable) 5458
Pension ( from your deceased father)(taxable) 2822
Total 11143

the problem has a risen as any payment although taxable is not taxed before being paid if it comes from the DWP.
So your mum will have to pay taxes on any excess over the £9440 allowances they say she is entitled to.
If the revenues sources of income and estimates are correct then the new tax coding they give her after taking into account the allowances should deduct the correct tax from the pension which it appears to be doing.
The harder job will be getting the 2012/2013 tax correct as they will have to deduct this from the tax coding when it is correctly ascertained. Good luck. Be prepared for frustration if you have to deal with HMRC really its better to fill a tax form in and get it calculated than try and talk to someone who may or may not know anymore than the average man in the street.

patanne

I think the phone is probably the best way to get an answer to where the income is coming from, they should be able to tell her precisely where it is from. I agree with Jimmo that soon after 8am is a good time not to be waiting for too long & also seem to get a better answer too. It is always possible that they have tried to do the correction & somehow got it wrong. Once you know that, if they have something wrong, speak to them & also put it in writing. Sometimes post takes quite a long time (weeks) to get dealt with, which is why I suggest phoning first.

JustAnotherSaver

I've just gone through her accounts with her again...

Bit of holding hands up time here guys - my mistake. The DWP IB is correct. There were 3 payments in October 2012 & not 2. I missed one when doing the total.

So, the PAYE is correct - my dads pension. That tallies.
The Incapacity Benefit now tallies.
It's the state benefits one that we can't understand which she needs to find out about.

jem16

JustAnotherSaver wrote: »

It's the state benefits one that we can't understand which she needs to find out about.

Ok do let us know what happens after your Mum phones HMRC.

Her tax code for 2013/14 at least seems to be taking into account her IB so tax should be correct from now on provided she is receiving no other taxable income.

It would have been interesting to see the P2 Coding Notices for 2012/13 though.

JustAnotherSaver

Bit of an update...

She called this morning & said the PAYE & IB are fine but questioned the state benefits.

Turns out they were billing her (wrong term perhaps, but you know what i mean) for Widows Pension. Not only was they billing her in the tax year in question but also the previous one in which she 'underpaid' by £300 i think it was.

She told them she doesn't receive & never has received widows pension so questioned why she was getting taxed for something she's never even received.

Because of this it now needs to go to another department who will be in touch with her.

And this is where we're up to right now.

jem16

JustAnotherSaver wrote: »

Turns out they were billing her (wrong term perhaps, but you know what i mean) for Widows Pension.

Are you sure they called it that?

Widow's Pension has not been a benefit available for anyone who was widowed after April 2001. It was replaced by Bereavement Payment, Bereavement Allowance and Widowed Parent's Allowance.

http://www.dwp.gov.uk/international/benefits/bereavement-benefits-and-widows/

As your Mum seems to have been entitled to claim Bereavement Allowance, have you any idea why she did not do so? Assuming you're positive that she did not receive it?

JustAnotherSaver

jem16 wrote: »

Are you sure they called it that?

No i'm not as i was at work (not being smart here, i'm just saying). What i am sure of is that is what my mum told me. Whether she's got it right i don't know. They may have told her one thing & 10 hours later she's calling it something else. OR she may be spot on & that may be what they said. I don't know for 100% on any of that as i wasn't there.

Widow's Pension has not been a benefit available for anyone who was widowed after April 2001. It was replaced by Bereavement Payment, Bereavement Allowance and Widowed Parent's Allowance.

http://www.dwp.gov.uk/international/benefits/bereavement-benefits-and-widows/

Thanks. Interesting. I'll tell her.

As your Mum seems to have been entitled to claim Bereavement Allowance, have you any idea why she did not do so? Assuming you're positive that she did not receive it?

No i've no idea tbh. I remember around the time i tried looking in to what she was entitled to.

I'm not 100% but i think i remember reading that she has the allowance or the benefit, but not both, so she took the £2k benefit. Or maybe they told her that she was entitled to that but not the allowance, i can't remember now. I do know she never received the allowance though.

jem16

JustAnotherSaver wrote: »

I'm not 100% but i think i remember reading that she has the allowance or the benefit, but not both, so she took the £2k benefit.

It's not one or the other - you are entitled to Bereavement Payment PLUS Widowed Parent's Allowance or Bereavement Allowance.

http://www.dwp.gov.uk/international/benefits/bereavement-benefits-and-widows/

Or maybe they told her that she was entitled to that but not the allowance, i can't remember now. I do know she never received the allowance though.

She would only not have been entitled if your Dad's NI contribution record wasn't up to scratch and from what you said this doesn't appear to be the case.

However it may have been that her receiving IB may have made the difference.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/260013/bb1_print.pdf

Does she still receive the same amount of IB now as she did in the year after your Dad's death?

JustAnotherSaver

Right i've asked her...

* The woman from the tax office most definitely said Windows Pension. Not only did the woman say this but she also asked whether my mum had received Widows Allowance (either of the 2). My mum said no to both.

* My mum found paperwork saying why she never got Bereavement Allowance - it was because her IB at the time was higher & she wasn't allowed to receive both. She could've received BA if she wanted, but then who's going to take the lesser benefit, so she stuck with IB.

* As for the figures, i'll check with the banking now as i type...

My dad died in Sept 2011 (late). My mums IB payments for the following months were:

Sept 2011: £199.70
March 2012: £199.70
04 April 2012: £199.70
18-April 2012: £205.64
20-March 2013: £210.10
03-April 2013: £210.10
17-April 2013: £212.73
01-May 2013: £214.70


Those are just some dates i selected. If you need more i can provide them.