Driven to Distraction

HumblePie_2

It's 11pm and I have just registered for the site, hopefully that will give you an idea as to the level of frustration I am suffering right now!! Here's the deal....

Received a revised tax code through the post today from our friends at the tax office. My code has been reduced from 808 to 265 or thereabouts.

On enquiring as to why this was the case I was informed the tax office have received my completed P11D and revised the code accordingly. I was informed it would increase my deductions each month for the rest of the year by some 110GBP approx and I would owe 900GBP approx at the end of the year.

I am at a complete loss as to what I am paying the increased tax for!! The chronology is as follows:

- Submitted SA back in June showing all business expenses - including additional mileage.
- Balanced this off with expenses received and assumed all was well.
- P11D shows approx. same amount give or take a few pounds.
- P11D is apparently the reason for the change in code...confused..I was!
- I can only think the category on the P11D has some significance in all of this. On the SA I included the full expense amount in travel and subsistence - I recall there is a specific box. On the P11D it was split between the travel/subsistence and general business expenses - mileage - does this matter, will it be treated differently?

Inland Revenue are telling me that there is additional 6k approx of Benefit in Kind in the P11D but when I do the match - the exact figure (to the penny) is made up of three expense items on the P11D submitted - are they including these expenses as a benefit in kind? If so, are they not effectively double counted in the submission - once in my original SA submission and now again as a benefit in kind which has not been balanced off against a business expense..in which case I am being taxed on legitimate business expenses........??!!

It's all so hard, help pls!

Bean_Counter

I'm not sure that I fully understand.

Firstly, are you completing a self-assessment return for your business expenses because you are self-employed, or because you want claim them as expenses from your employment?

Was your P11D prepared by your employer, or was it prepared by you because you are an employee of your won limited company (or something along those lines?)

Figures are usually put on a P11D because you have some sort of taxable benefit, hence the reason that you tax code has changed and you are paying more tax. From your post above, it sounds like you have put expenses and deductions on the P11D instead of taxable benefits.

Maybe I have read this wrong, but please can you post some more info.

Thanks.

Pennywise

Did you submit your SA return on paper - if so, it might not have been dealt with yet as they can take 2-3 months to process their incoming mail. It sounds as if they have worked your PAYE code based on the P11d and ignored your SA return - you need to contact them to tell them to refer against your SA return and then they should correct your PAYE code. I am assuming you completed your SA return correctly - you should have put the figures as per the P11d on page 1 of the employment section to declare the money coming in, and then the same figures on page 2 to claim the expense, therefore cancelling eachother out.