Tax Code Query

Silaqui

Hi, hope this is the right place - please redirect me if I'm wrong.

I have recently been sent a new tax code by HMRC which I thought was wrong after researching online. I rang to query it and the woman on the phone told me something that appeared to contradict everything else I've read.

Some advice would be much appreciated.

I thought that on order to pay 40% tax you had to earn personal allowance PLUS 31k-ish. So you pay 40% tax on anything above approx 41k.

I have a main job which pays 38k,and a second job which is seasonal and pays around £700. I fully expected to be on the BR code for the second job, but when the coding notice came it said D0?

When I rang HMRC the woman said that you pay 40% on e everything above 31k and so the code is right.

Is this correct and could someone explain why? Or was I right in the first place?

Thanks in advance
S

TadleyBaggie

You are right and she is wrong.

CLAPTON

Silaqui wrote: »

Hi, hope this is the right place - please redirect me if I'm wrong.

I have recently been sent a new tax code by HMRC which I thought was wrong after researching online. I rang to query it and the woman on the phone told me something that appeared to contradict everything else I've read.

Some advice would be much appreciated.

I thought that on order to pay 40% tax you had to earn personal allowance PLUS 31k-ish. So you pay 40% tax on anything above approx 41k.

I have a main job which pays 38k,and a second job which is seasonal and pays around £700. I fully expected to be on the BR code for the second job, but when the coding notice came it said D0?

When I rang HMRC the woman said that you pay 40% on e everything above 31k and so the code is right.

Is this correct and could someone explain why? Or was I right in the first place?

Thanks in advance
S

as you tell it then you are correct

what is your main taxcode?

try ringing again and talking to some-one else.

Silaqui

Hi, thanks for the replies. Apologies for shortness as I'm at work, but my tax code for the main job is 1000l. I gather this is the standard one?
Will try calling again and see what they say. Thanks again.
S

xylophone

https://www.gov.uk/reporting-your-tax-code-as-wrong

http://www.moneysavingexpert.com/banking/tax-rates

System

They do this if your circumstances change during the year.
I changed from full to part time work during this year, when my state pension cut in. My total annual income is unchanged, at £35,000, yet they put me on 40% rate on the pension.

I wrote querying this and got a reply saying this was standard practice - I would get a tax refund at the end of the year when they aggregated both P60s.
It seems very unfair.

xylophone

Puzzled by this - you have a salary and a state pension - why can the tax on the state pension not be collected through your employer at the appropriate rate by adjustment to your tax code?

https://www.gov.uk/tax-on-pension/how-your-tax-is-paid

And you don't receive a P60 for state pension.

jem16

Clifford_Pope wrote: »

They do this if your circumstances change during the year.
I changed from full to part time work during this year, when my state pension cut in. My total annual income is unchanged, at £35,000, yet they put me on 40% rate on the pension.

I wrote querying this and got a reply saying this was standard practice - I would get a tax refund at the end of the year when they aggregated both P60s.
It seems very unfair.

It's not standard practice to put you on a D0 (ie all at 40%) tax code just because your circumstances change.

More than likely they think you will be working full-time and also receiving your state pension so needing to pay some tax at 40%.

As to the state pension receiving a 40% rate this makes no sense at all as the state pension is received gross. Any tax due is taken through other income such as job or other pension ( ie not state).

jem16

Silaqui wrote: »

Hi, thanks for the replies. Apologies for shortness as I'm at work, but my tax code for the main job is 1000l. I gather this is the standard one?

It is the standard tax code, yes.

Will try calling again and see what they say. Thanks again.
S

I suspect that whoever answered has misunderstood, perhaps when you mentioned seasonal work? perhaps they were under the impression that you were going to receive £700pm as opposed to £700pa?

However she was wrong with the £31k and above being 40% unless she was referring to taxable bands in which case she was correct.

agrinnall

I'm also going for a misunderstanding, while many people on here have a low opinion of HMRC staff it would be a very poor one indeed who really gave the response you think you got.