HMRC (PAYE) Tax Demand

jem16

lycrawearer wrote: »

Success - not sure why - apparently a letter will be in the post to me explaining in more detail ... but I'm happy.

Glad it all worked out for you. It would be interesting to see what the letter says to see what went wrong though.

bearcat16

I once got a bill from HMRC for £1,200 with absolutely no explanation, despite being employed with no other income and paying all my tax through PAYE.

I called and asked them what it was for and they kept saying "it is for the difference in what you've paid and what tax is due". Hilarious answer! They would not (or could not) give any more detail.

I wrote to them explaining that my tax is all paid through PAYE and that I was certain my employer had made deductions correctly, and hilariously they wrote back with the same phrase "it is the difference between what you have paid and the tax due".

I wrote back saying that if I, or any reasonable person, received a bill for something that simply said "you owe this" with no other explanation, we wouldn't pay it without at least knowing what it was for. And to please show me the calculation that they've used.

I never heard any more about it, that was about 5 years ago.

Incidents like this made me seriously question new powers HMRC got to take money they THINK is owed directly from people's bank accounts.

They are often a bunch of incompetent numskulls who have an inordinate level of power to cause mayhem in people's lives through errors they cannot put right.

patanne

It also makes me wonder how many people a letter like that scares and because they are HMRC just pay up without asking.

teddysmum

They don't even let you off payment if it is the employer (in my case pension provider's error).


Mine didn't deduct tax for my first year of retirement (near the end of a tax year). I contacted HMRC, after receiving a bill and they said the pension provider had not made deductions as they hadn't received my tax code.


Actually, they would have had two copies, as I sent them mine, because I didn't know that HMRC do this automatically, but HMRC said they had to believe the provider, making them fault free, so I had to pay up.

booksurr

teddysmum wrote: »

They don't even let you off payment if it is the employer (in my case pension provider's error).


Mine didn't deduct tax for my first year of retirement (near the end of a tax year). I contacted HMRC, after receiving a bill and they said the pension provider had not made deductions as they hadn't received my tax code.


Actually, they would have had two copies, as I sent them mine, because I didn't know that HMRC do this automatically, but HMRC said they had to believe the provider, making them fault free, so I had to pay up.

it never ceases to amaze me how anyone who subsequently finds out their tax was underpaid didn't notice that the amount of money they were getting was higher than expected. Naturally therefore when quite rightly asked to pay the tax they owe on their own earnings it is somehow "unfair" that they can't be left tax free whilst everyone else pays up regardless

jem16

teddysmum wrote: »

They don't even let you off payment if it is the employer (in my case pension provider's error).


Mine didn't deduct tax for my first year of retirement (near the end of a tax year). I contacted HMRC, after receiving a bill and they said the pension provider had not made deductions as they hadn't received my tax code.

That sounds like your pension provider used the emergency tax code which gave you allowances that you weren't entitled to which meant your pension was paid tax-free as it was under the threshold for paying tax. Your pension provider could not just simply pay no tax.

Actually, they would have had two copies, as I sent them mine, because I didn't know that HMRC do this automatically, but HMRC said they had to believe the provider, making them fault free, so I had to pay up.

They may well have been fault free. HMRC send the codes electronically. If that code wasn't received the employer couldn't have used it, whether or not you sent a paper copy.

However why didn't you notice that they weren't using the correct tax code? It is ultimately your responsibility.

patanne

Is there any point any longer in giving an employer/pension provider a P45. They seem to just ignore it and do as the book says and that is what seems to be leading to many people's problems when changing employer or retiring. I suspect what may have happened in this case is the the last salary and first pension were in the same month. If the P45 HAD been used then the correct tax would have been deducted. How would you know that the tax code was incorrect it should have been the same as on the P45 and using that month for the second time, ergo no tax free allowance due.