New Job - Tax Question

TheEffect

Hi, I started a new job on 15th October (After being a student until July, then receiving ESA from July until October).

My tax code is 1223L/M1. My November pay was £1799 before tax, and I have been taxed £170 (and £189.07 NI). I received around £1100 in Oct and didn't pay any tax, but was on a different tax code.

From my understanding, Apr 2013 - Apr 2014 tax year:
October - £1100
November £1799
December £1799
January £1799
February £1799
March £1799

Total: £10,095
Tax free allowance: £12230

Does this mean I should not be taxed until April, or have I missed something?

Thanks!

engineer_amy

The M1 suffix to your tax code means month 1. Standard practice to put employees on a month 1 / week 1 code when they start work part of the way through the year. It usually happens either where the employer has put you on the same code as appeared on your p45.
Instead of you being on a cummulative tax code, it is taking each month as stand alone, and applying one twelfth of your allowance to each wage. It will stay like that until the next tax year unless your employer receives a new coding notice from HMRC. If it stays as M1 until april you will receive a rebate in the new tax year if you havent reached the threshold and have overpaid tax.

TheEffect

engineer_amy wrote: »

The M1 suffix to your tax code means month 1. Standard practice to put employees on a month 1 / week 1 code when they start work part of the way through the year. It usually happens either where the employer has put you on the same code as appeared on your p45.
Instead of you being on a cummulative tax code, it is taking each month as stand alone, and applying one twelfth of your allowance to each wage. It will stay like that until the next tax year unless your employer receives a new coding notice from HMRC. If it stays as M1 until april you will receive a rebate in the new tax year if you havent reached the threshold and have overpaid tax.

blondebubbles wrote: »

Do you mean the 2014/15 tax year?

Did you give in a P45 or complete a starter checklist when the job began?

I handed them the P45 I received from ESA when I cancelled my claim. My first pay showed tax code 1000L, and I wasn't taxed. Shortly after however, I found out I was entitled the Blind Persons Allownace, so I phoned the tax office who changed my tax code.

My new tax code is showing as 1223L, but has the M1 after it for emergency tax.

Not sure why I'm on emergency tax... could it be a delay between HR and the tax office?

TheEffect

blondebubbles wrote: »

So did you get a coding notice from HMRC? Only they could have decided on that code, your employer couldn't have.

When you were on esa was it contributions or income based?

I'm not sure what a coding notice is. I received a letter from HMRC stating my new tax code is 1223L, and my new personal allowance is xxxxx, and that they would inform my employer of my new tax code, which I'm guessing they've done as it's changed on my payslip, but with M1 after it.

I was in the income-based ESA group I believe.

engineer_amy

If they received the 1223L code from hmrc then there are a few options of what has happened:
Hmrc have given them the code with M1 attached
Company have applied M1 themselves as policy.

A call to hmrc might straighten things out and they could send a new coding notice to your employer

TheEffect

engineer_amy wrote: »

If they received the 1223L code from hmrc then there are a few options of what has happened:
Hmrc have given them the code with M1 attached
Company have applied M1 themselves as policy.

A call to hmrc might straighten things out and they could send a new coding notice to your employer

Thanks. I'll give HMRC a call tomorrow, and if not I'll email my companies HR department, though am still waiting for a reply from an email I sent them 11 days ago!

TheEffect

HMRC have put me on M1 tax code as the P45 I received from ESA did not have any numbers on it, therefore they did not know how much they had paid me.

They have now put me on cumulative tax code 1223L, and have put £0 as received via ESA as that's what the P45 states.

She said if ESA do provide details, they'll adjust my wages to repay what they've overpaid me.

Not sure whether to contact ESA myself or just leave it and see if it sorts itself.