Tax code change. Do we need to notify the OR???

Noodles78

Hi all.


As of this month I will be paying tax again after my Nil Tax IPA has now finished (Hurrah).


I've been notified by HMRC of this & they have given me a New Tax code which is in line with the New changes for 2014-2015.


With this change, which I'm sure affects everybody who is either undischarged or currently in an IPA. Can someone confirm for the following;

• Do we all have to inform the OR of this change as it'll mean we have a couple of quid back in our pockets each month. Therefore a New SOA to be re-submitted by everyone!!!
• Or will they have already taken this into account & view it like a cost of living rise as such which then I don't believe they then require to be informed of if this is the case. Could be wrong with regards to the latter?

As always. Appreciate to hear peoples views & comments.

National_Debtline

Hi Noodles78

You shouldn't need to specifically inform the OR as they will be aware that the nil code only applies for the remainder of the tax year in which you went bankrupt. Of course I would recommend that you report significant events like pay rises. If it gives you peace of mind, give their office a call to clarify their intentions.

Regards

Dennis @NDL

Noodles78

Hi Dennis.


What I meant to come across is that my tax code was 944L when I declared Bankruptcy then that was changed to Nil because of the Nil Tax IPA but has now reverted back but to a higher tax band of 1000L in line with the Government allowing us to earn £10000 before being taxed from April 2014. (Worked this out over my wages as approximately £9 a month better off).

• So is this classed as a pay rise or more like a cost of living rise?
• And would the Tax code change even be deemed as being significant enough to have to inform the OR?

tiggerbodhi

Your income has technically gone up by £9 per month so you should inform the OR or sub contractor dealing with it, but at this point you should do a new SOA so with the cost of living rises since you last did a SOA it will probably swallow this rise or maybe more so your IPA might go down.


My OR and at the time Moon Beever said they were only interested in "significant" changes so if nothing much else has changed would be worth a quick email to them just to let them know and leave the ball in their court as the tax code change will be affecting everyone in an IPA!

TheGardener

To be honest - I think the OR is well aware of the new tax codes and I suspect the administrative cost of changing every BR's SOA and IPA for the sake of a few quid would be overwhelming and not cost effective - like most of the public sector/civil service - there are half the number of staff there once were. As tiggerbodhi points out - the cost of living has risen anyway, I know my rent has gone up by £12 a month from this week so the rise in the tax allowance is wiped out by that alone. Personally, I wont be bothering to inform my OR.

philnicandevan

TheGardener wrote: »

To be honest - I think the OR is well aware of the new tax codes and I suspect the administrative cost of changing every BR's SOA and IPA for the sake of a few quid would be overwhelming and not cost effective - like most of the public sector/civil service - there are half the number of staff there once were. As tiggerbodhi points out - the cost of living has risen anyway, I know my rent has gone up by £12 a month from this week so the rise in the tax allowance is wiped out by that alone. Personally, I wont be bothering to inform my OR.

Hmm remember though you signed a LEGAL document in court with a judge etc that same paperwork says you have 21 days while still BR to inform the ORs office of any financial change however small or large

egrescrimp

When I was having my interview I was told they aren't really interested in small changes, I doubt they would be interested in £12.

luvchocolate

Hi as Phil said we signed to say we would inform them, I did and also pointed out the increase in my energy bills, they thanked me for letting them know, and took no action.
I would always tell them of any changes, sure it will be fine but you will know you did as instructed

Noodles78

TheGardener wrote: »

To be honest - I think the OR is well aware of the new tax codes and I suspect the administrative cost of changing every BR's SOA and IPA for the sake of a few quid would be overwhelming and not cost effective - like most of the public sector/civil service - there are half the number of staff there once were. As tiggerbodhi points out - the cost of living has risen anyway, I know my rent has gone up by £12 a month from this week so the rise in the tax allowance is wiped out by that alone. Personally, I wont be bothering to inform my OR.

I'm with the Gardener on this one. The OR's will be more than aware of the New tax codes being implemented from April 2014.
I to have had an increase to my rent from last week as well as cost of living rises. So if you take the £9 increase in my wages from the New tax code then deduct the £10 increase in my rent, I'm officially £1 worse off. When I last spoke to my OR (along time ago) they also informed me they did not need notifying of any changes unless they were SIGNIFICANT to my income & expenditure. So, does my OR really want to be contacted with regards to this? Think after being so by the book the last 6-7months I'll dare for once to use my common sense & say that I don't need to inform my OR on this occasion. And if I'm wrong, I'm sure they'll be in contact.........

TheGardener

My income is low so I got to keep a bit of the tax money so when I start paying tax again and taking into account my rent rise - I will be worse off despite the rise in allowance. I can inform the OR but as I don't have an IPA - it will make no difference that I can see.

macbabypam

I'm with The Gardener too. MY OR also told me they were only Intersted in significant regular changes to my income. In fact I asked them about working extra shifts at work and she told me to go ahead and only wanted to know if I earned more than £150 extra a month.

Now I know everyone's circumstances are very different and the advice given by ones OR is specific to your own circumstances, but don't think I need to worry about the few extra pounds I will get from new tax code.