SA102 vs P87 - Tax doesn't need to be taxing?

markelock

Hi

I recently submitted a return on a P87 for expenses (mileage) for 2011-12. It was slightly over £2500, so it was returned and I was asked to complete an SA form.

However, the figures come out completely differently using each form.

The P87 comes out at
Received £5807
Expenses £8599

So I should be due a refund on the difference? at 40%.

However online, and using my p60 details, it's calculating a rebate of £600 ish ???

So confused...

TheCyclingProgrammer

You don't get the difference, you get tax relief on the difference at your marginal rate. It looks like its calculating relief at basic rate though. You'll need to provide the figures you're entering here for somebody to be able to say if they are right or not.

markelock

Hi

Yes, I'm expecting 40% of the difference between the two figres

This is what it looks like


This section provides you with a breakdown of your full calculation.

Pay from employments £42,820.00
plus benefits and expenses received £5,807.00 (My expenses received)
minus allowable expenses £8,600.00 (my expenses allowed by HMRC)
Total from all employments £40,027.00
Total income received £40,027.00
minus Personal allowance £7,475.00

Total income on which tax is due £32,552.00

How we have worked out your income tax

Amount Percentage Total
Pay, pensions, profit etc £32,552.00 @ 20% £6,510.40
Total income on which tax has been charged £32,552.00
Income Tax charged £6,510.40
minus Tax deducted
From all employments £7,136.00
Total tax deducted £7,136.00
Income Tax overpaid £625.60
Estimated overpayment at 31 January 2013
2011-12 balancing credit £625.60
1st payment on account for 2012-13 due 31 January 2013
(Note: 2nd payment of £0.00 due 31 July 2013)
£0.00
Total overpaid at 31 January 2013 £625.60

I've not put anything from my P11D in (although I have asked for it from my employer), should that be relevant.

purdyoaten

Fairly simple really - you were JUST a HR taxpayer in 2011/12 (before the claim) The limit before one became a HR taxpayer in 2011/12 was £42475 - you were £345 above this.

Your claim is based on £2792 (8599 -5807) £2447 is relieved at 20% plus £345 relieved at 40% = £627.40. The difference is due to rounding (strictly PAYE tax should have been £7138, not £7136)

You cannot obtain relief at 40% on £2792 because you only paid at 40% rate on £345.

markelock

Thanks. Its confusing though, my salary is £40k, I then receive £6K in car allowance (gross), should those figures be in my P60?

purdyoaten

markelock wrote: »

Thanks. Its confusing though, my salary is £40k, I then receive £6K in car allowance (gross), should those figures be in my P60?

Is the car allowance included in payslip i.e. at £500 per month every month?

If it is, it should be on your P60 but it does not appear to have been taxed according to the figures quoted.

How is the car allowance paid?

markelock

via my salary. I think I might need to call my HR reps...

My reference salary was £41,225, car allowance £6000, I took £2916 in childcare vouchers, and £668 in medical "benefits"

There is also a 3% pension contribution

purdyoaten

markelock wrote: »

via my salary. I think I might need to call my HR reps...

My reference salary was £41,225, car allowance £6000, I took £2916 in childcare vouchers, and £668 in medical "benefits"

There is also a 3% pension contribution

Waters well and truly muddied.

However, I think that your P60 is correct

P60 should be £41225 plus £6000 less £2916 = £44309. If the car allowance is pensionable (?) your taxable salary will be 97% of this (100% less 3% pension ) equating to £42979.

If it isn't it should read £41225 plus £6000 less £2916 less pension £1149 (3% of £41225 minus £2916) = £43160.

markelock

But if I submit the p87, with an amount under £2.5k, they should pay me at 40%, not 20%?

purdyoaten

markelock wrote: »

But if I submit the p87, with an amount under £2.5k, they should pay me at 40%, not 20%?

Why? You only claim relief against tax paid. You did not pay £2792 at 40% rate.

If you had earned £2792 over the basic rate limit of £42475 you would have been able to claim all of this at 40%. You didn't as I explained in my first post.