Underpaid Tax backdated 2010/2011

Hanger_Queen

Good afternoon all.

I'm hoping the collective could shine some light on a situ for me (or point me in the right direction).

Tax yr 2014/2015 I paid a sum of tax but I had not earned enough in that year to reach the £10,000 threshold. Hence I contacted HMRC only to receive a p800 at the weekend advising me the tax I had paid was in fact a payment for a tax underpayment for financial yr 2010/2011.

I was made redundant Dec 2010 with my last contracted day 17/12. It was agreed that as I was receiving Statutory Maternity at the time of redunancy, I would carry on receiving SMP from my employer on a monthly basis until March 2011, which would mark the end of SMP.
HMRC have advised that they have 17/12 as my last employment day but it appears the employer restarted my employment the next day, thus creating another tax allowance for PAYE earnings. They (HMRC) claim I was then not paying the tax I should have been on the SMP as it should have gone on one continuous employment rather than an apparent new allowance (I hope that makes sense).

HMRC took monies tax yr 12/13 and 14/15 which was due to me surpassing the tax allowance but have an outstanding claim of just over £500. I have not been taxed thus far this financial year. My current wage is by far below the new £10,600 threshold.

I am unable to speak to the right person who repesents my former emplyer until next Tuesday but until then I'm wondering if this all seems black and white or I'm looking at a fight to clear this.
Any words of advice greatly appreciated.

agrinnall

Hanger_Queen wrote: »

HMRC have advised that they have 17/12 as my last employment day but it appears the employer restarted my employment the next day, thus creating another tax allowance for PAYE earnings.

Are you saying that your employer gave you an entire year's allowance (standard was £6475 in 2010-11) starting from December 2010, and that as a result you paid no tax on your SMP? If so then you owe the tax, but whether you have to pay it or not depends on complexities that are beyond my knowledge, so hopefully someone who does know will post.

It's possible, although I suspect unlikely, that you could be covered by ESC A19, or they could be too late asking for it.

patanne

Wouldn't the SMP be below what was taxable & would actually have led to a small tax rebate each month?

Hanger_Queen

Are you saying that your employer gave you an entire year's allowance (standard was £6475 in 2010-11) starting from December 2010, and that as a result you paid no tax on your SMP?

Yes, it appears that way. I paid tax in that short period of Dec to Mar but not enough.

Wouldn't the SMP be below what was taxable & would actually have led to a small tax rebate each month?

Good question. I'll openly admit that I struggle when it comes to tax and the calculations associated with. Would there be any reason for the redudancy monies recieved in Dec to be taxable hence HMRX expecting a high tax payment for those few short months of Dec - Mar?

Hanger_Queen

I have spoken with HMRC via telephone and they claim to have sent a p800 back in 2012. I received no such paperwork so we're apparently at loggerheads there.

patanne

Are they going to re-send the P800? If they do, you need to carefully check their figures. Do you still have your P45 from the Dec or the last payslip and also one of the ones from the SMP period?

Hanger_Queen

No, I have neither. I destroy such paperwork after 3 years. Given I have yet to hear back from my ex employer, I am at a standstill with a resolution. HMRC hold firm that I owe monies. They are not changing their calculations. It's frustrating at the very least.

chrisbur

Hanger_Queen wrote: »

No, I have neither. I destroy such paperwork after 3 years. Given I have yet to hear back from my ex employer, I am at a standstill with a resolution. HMRC hold firm that I owe monies. They are not changing their calculations. It's frustrating at the very least.

If you have not yet requested a copy of the P800 you should do this and when you have the figures post them on here.
In the meantime what rate of payment were you receiving for SMP?
How many payments did you get after the P45 was issued?
Were you paying tax in the 40% band or higher?
Did you receive a tax rebate for 2010/2011 eg by sending in P45 with a P50?