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P11D Query

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Hi,

Was wondering if anyone could help....

My partner has been working for a company now for 14 months however yesterday she received a note from her previous employer saying that they had forgot to cancel her Aviva medical cover and enclosed a copy of her P11D which states an amount of £424.24. The note goes on to say they “aren’t sure if she can appeal direct to the taxman”. She doesnt fill in a self assessment at present.


Could anyone shed any light on what this means and what we are supposed to do?


Many Thanks.
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Comments

  • zygurat789
    zygurat789 Posts: 4,263 Forumite
    Part of the Furniture Combo Breaker
    I thought that benefits in kind were benefits received as a result of being employed in a particular job. This doesn't appear to be the case hear.
    The only thing that is constant is change.
  • cossie23
    cossie23 Posts: 32 Forumite
    Part of the Furniture 10 Posts Combo Breaker
    Medical cover is a taxable benefit as far as I know but we're not sure where we go from here. I'm thinking that although she wasnt paying for the medical cover the taxman would have thought she still was and thus on the wrong tax code.

    I could be wrong though!
  • zygurat789
    zygurat789 Posts: 4,263 Forumite
    Part of the Furniture Combo Breaker
    cossie23 wrote: »
    Medical cover is a taxable benefit as far as I know but we're not sure where we go from here. I'm thinking that although she wasnt paying for the medical cover the taxman would have thought she still was and thus on the wrong tax code.

    I could be wrong though!

    Medical cover provided by an employer to an employee is taxable because it is received by the employee by virtue of the fact that the employee is employed in that job.

    http://www.hmrc.gov.uk/manuals/eimanual/eim00530.htm

    From what you say your partner was not an employee of the company which paid for the health cover at ANY TIME during the tax year.
    A P11D should only be completed for an employee so I don't see that the old employer should even have completed one for your partner.
    The only thing that is constant is change.
  • cossie23
    cossie23 Posts: 32 Forumite
    Part of the Furniture 10 Posts Combo Breaker
    Ok, thanks for your help. I'll check it out and see what happens. Probably we are due them money!!
  • chrismac1
    chrismac1 Posts: 2,585 Forumite
    Be robust. This sort of thing is quite common with incompetent payroll and HR types who populate some companies. I've run across this with a few clients, the most recent one being on a top director at a large company where his employer unbeleivably had 4 goes at his severance and still didn't get it right.

    A bit like HMRC, such employers often try it on a bit and place the responsibility with the employee. Be robust. You were not an employee so could not have any benefits. Any money they paid is their stupid problem, any tax is their stupid problem and they should get out the company cheque book.
    Hideous Muddles from Right Charlies
  • zygurat789
    zygurat789 Posts: 4,263 Forumite
    Part of the Furniture Combo Breaker
    The ball is now in HMRC's court, I would do nothing until you hear from them.
    They could either do nothing, issue a K code to your old employer or amend the code with the present employer. You would only have to bother if it were the latter.
    The only thing that is constant is change.
  • patanne
    patanne Posts: 1,286 Forumite
    Surely this can't actually be taxable? Unless it was written into your contract / leaving agreement that it would continue after leaving, then no-one would know that they could use it and therefore it could not be a benefit. I guess that would be WAY too logical!
  • purdyoaten
    purdyoaten Posts: 1,159 Forumite
    cossie23 wrote: »
    Hi,

    Was wondering if anyone could help....

    My partner has been working for a company now for 14 months however yesterday she received a note from her previous employer saying that they had forgot to cancel her Aviva medical cover and enclosed a copy of her P11D which states an amount of £424.24. The note goes on to say they “aren’t sure if she can appeal direct to the taxman”. She doesnt fill in a self assessment at present.


    Could anyone shed any light on what this means and what we are supposed to do?


    Many Thanks.

    What a cheek! Why on earth can the company not contact its insurance company and claim a refund as a result of cover provided to an EX- EMPLOYEE in error?
    There are 10 types of people in the world - those who understand binary and those who do not. :doh:
  • cossie23
    cossie23 Posts: 32 Forumite
    Part of the Furniture 10 Posts Combo Breaker
    Hi Folks,

    Thanks for all the advice, much appreciated. She is going to contact her "new" employer payroll department to see if they can offer any assistance. Failing that I think we will contact the tax office to check what they think.

    I fear the worst!!!

    Cheers
  • Sadly, as chrismac1 states, this is not unusual....

    This is the method that I would recommend to get it corrected:

    1. Write a letter to the old employer, send by recorded delivery, and state that the error is theirs and in no way can it be perceived as a benefit that should be included on the P11D. You did not ask for the medical cover and it was not part of your leaving agreement, so no benefit has been received and should never have been reported on the P11D.

    2. If the P11D included other things on it that were correct, demand that they issue a new one without the medical cost included. If the medical cost was the only item on the P11D, demand that they send a letter to cancel the P11D to HMRC. The letter or new P11D with covering note, should be sent to:

    HMRC NIC and EO
    Room BP8002
    Tynemouth House
    Benton Park View
    Longbenton
    Newcastle Upon Tyne
    NE98 1ZZ

    3. Eventually, HMRC should catch up with things but as a safety measure, write to HMRC yourself stating that the P11D is incorrect, detailing why, and that you have requested that the employer contact them to correct the situation.

    The reason that I suggest to write is that life is too short to be ringing HMRC and you can never be sure that you are going to get anyone with any sense. A letter has a better chance of being acted on correctly... but there are no guarantees!
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