Wrong Tax Code - Obtaining a Refund

gohan2091

At the end of February 2016 I have a new job with the NHS. I forgot to hand in my P45 from my previous employer so I was put on an OT CUMUL which means for tax period 12, I paid £224.20 tax which is way higher than I should be paying. I would like to mention that in tax period 11 with my previous employer (Sainsburys) I only earnt just over £7000 in total.

I phoned HMRC in March and they told me they would refund me any overpaid tax via cheque. It's now May and I haven't received anything. I now have my 2nd pay slip from the NHS (tax period 1) with a correct tax code of 1106L CUMU and the tax I paid is £34.40 (side question, why do I have to pay PAYE £34.40? is this because tax is being spread evenly across my pay packet? since I would be over my personal allowance by the end of the tax year? I think so)

I called HMRC today and they tell me because I am on self assessement, I need to claim back the overpayment in tax for period 12 of 2015/2016 when I submit my self assessment. I don't know how to do this, can anyone help? Where in the self assessement online form does it let me claim this back?

I would like to mention here that I have not recieved my P60 from the NHS and I have today closed down self assessment and just using PAYE from now on.

agrinnall

The easy answer is that SA is available at the link below - you can't use it until you have received a UTR and it's associated pass code (sent separately).

https://www.gov.uk/topic/personal-tax/self-assessment

However, I'd also question why you have to do SA at all. Were you previously registered for self employment? You could use the link on the above page to check whether you need to do SA.

And yes, you get one twelfth of your personal allowance each month.

sheramber

When you submit a self assessment tax return the computer will calculate the tax due on all your income and compare it to the tax that has been deducted. If you have paid too much tax it will automatically show an overpayment.

There is a section on the return for you to claim any tax overpaid which will mean the repayment will automatically be issued to you or to your bank account if you request that.

If you have been registered for self assessment for 2015/16 you will need to complete a 2016 return unless the return was issued unnecessarily and HMRC agree to cancel it.

gohan2091

I have been completing self assessements online for the last 2 years because I do photography on the side. I have now changed this to pay any tax owed by my tax code and that's why I now cancelled my self assessement. I didn't know I could pay using my tax code for the past two years, I only earn a small amount of money from Photography. My 2015/2016 needs to be completed but I need to make sure that the tax overpayment from the last month of that tax year will be refunded to me.

@sheramber, the section where I can claim overpayment would be where exactly? The Overpaid tax section? I am not very good at completing a self assessment and I tend to get confused easily. In that Overpaid tax section, towards the end it says:

Adjustments to tax due

Do you need to make any adjustments to increase or decrease your tax due for 2015 to 2016? This may apply if you are claiming averaging for farmers or creators of literary or artistic work or you had post-cessation receipts.

Increase in tax due because of adjustments to an earlier year: £
Decrease in tax due because of adjustments to an earlier year: £
Any 2016-17 repayment you are claiming now: £

Is this where I enter it? I am confused. I'm not exactly sure how much of the £224.20 tax paid in tax period 12 I am entitled to have refunded to me. Would I reduce this by £34.40 since that's the tax I paid for tax period 1 of this tax year?

Darksparkle

gohan2091 wrote: »

I have been completing self assessements online for the last 2 years because I do photography on the side. I have now changed this to pay any tax owed by my tax code and that's why I now cancelled my self assessement. I didn't know I could pay using my tax code for the past two years, I only earn a small amount of money from Photography. My 2015/2016 needs to be completed but I need to make sure that the tax overpayment from the last month of that tax year will be refunded to me.

@sheramber, the section where I can claim overpayment would be where exactly? The Overpaid tax section? I am not very good at completing a self assessment and I tend to get confused easily. In that Overpaid tax section, towards the end it says:

Adjustments to tax due

Do you need to make any adjustments to increase or decrease your tax due for 2015 to 2016? This may apply if you are claiming averaging for farmers or creators of literary or artistic work or you had post-cessation receipts.

Increase in tax due because of adjustments to an earlier year: £
Decrease in tax due because of adjustments to an earlier year: £
Any 2016-17 repayment you are claiming now: £

Is this where I enter it? I am confused. I'm not exactly sure how much of the £224.20 tax paid in tax period 12 I am entitled to have refunded to me. Would I reduce this by £34.40 since that's the tax I paid for tax period 1 of this tax year?

Tax isnt looked at monthly, it's annually.

You complete your tax return to show all pay from employment and all tax already paid as well as any other taxable income, self employment, property, interest etc.

From there the system will calculate your total taxable pay and total tax due/overpaid.

Although tax is annual, when PAYE your personal allowance is split equally each month so if your tax code is 1106L that means you have a personal allowance of £11,060. Each month you can then earn £921.67 without paying tax.

gohan2091

Darksparkle wrote: »

Tax isnt looked at monthly, it's annually.

You complete your tax return to show all pay from employment and all tax already paid as well as any other taxable income, self employment, property, interest etc.

From there the system will calculate your total taxable pay and total tax due/overpaid.

Although tax is annual, when PAYE your personal allowance is split equally each month so if your tax code is 1106L that means you have a personal allowance of £11,060. Each month you can then earn £921.67 without paying tax.

I'm confused by the £921.67 but anyway, on my first payslip from the NHS it says PAYE £224.20 and this is dated March 31st. This is wrong, I never had to pay any tax in months 1-11 with my previous employer Sainsburys because I was well under my personal allowance so on the 12th month, moving to the NHS without a p45 submitted to them, it's £224.20. This must be to do with the 0TCUMUL tax code.

On my 2nd NHS payslip from month 1, it says £34.30 under PAYE. There is a big difference between £224.20 and £34.30. I am still confused where exactly I enter this information in the self assessment form but when I can get hold of my P60, I will try and complete this and if it doesn't refund me, I will have to make a call to HMRC.

Darksparkle

gohan2091 wrote: »

I'm confused by the £921.67 but anyway, on my first payslip from the NHS it says PAYE £224.20 and this is dated March 31st. This is wrong, I never had to pay any tax in months 1-11 with my previous employer Sainsburys because I was well under my personal allowance so on the 12th month, moving to the NHS without a p45 submitted to them, it's £224.20. This must be to do with the 0TCUMUL tax code.

On my 2nd NHS payslip from month 1, it says £34.30 under PAYE. There is a big difference between £224.20 and £34.30. I am still confused where exactly I enter this information in the self assessment form but when I can get hold of my P60, I will try and complete this and if it doesn't refund me, I will have to make a call to HMRC.

You can't look at one month in isolation or compare two different tax years.

For 2015/16 what was your total taxable income (so all employment, self employment etc). If less than £10600 you'll get a refund when you do your SA return. If over £10,600 it will depend on how much over.

That assumes you have a standard personal allowance for 2015/16.

The SA return has a section for employment. You put your pay from your P60 in one box and the tax paid in another. Have you not been employed in previous tax years? If you have been employed you should be aware of this section as you would have completed it before.

The £921.67 is your personal allowance this year £11,060 (based on the 1106L tax code you stated) divided by 12 months. Without knowing your income for month 1, no one can tell you if that is correct. However I would assume your pay was £1095 to pay £34.40 tax on a tax code of 1106L

[Deleted User]

agrinnall wrote: »

The easy answer is that SA is available at the link below - you can't use it until you have received a UTR and it's associated pass code (sent separately).

https://www.gov.uk/topic/personal-tax/self-assessment

However, I'd also question why you have to do SA at all. Were you previously registered for self employment? You could use the link on the above page to check whether you need to do SA.



And yes, you get one twelfth of your personal allowance each month.

I completely agree - I would simply write a letter and repeat the details in the first post to include references and ask for a review of tax liability for the tax year. I have been doing this for many a year. Why subject yourself to self-assessment for no reason?

Nevertheless the op is under self-assessment and must submit regardless - -seems a convoluted way to do things!

gohan2091

Darksparkle wrote: »

You can't look at one month in isolation or compare two different tax years.

For 2015/16 what was your total taxable income (so all employment, self employment etc). If less than £10600 you'll get a refund when you do your SA return. If over £10,600 it will depend on how much over.

That assumes you have a standard personal allowance for 2015/16.

The SA return has a section for employment. You put your pay from your P60 in one box and the tax paid in another. Have you not been employed in previous tax years? If you have been employed you should be aware of this section as you would have completed it before.

The £921.67 is your personal allowance this year £11,060 (based on the 1106L tax code you stated) divided by 12 months. Without knowing your income for month 1, no one can tell you if that is correct. However I would assume your pay was £1095 to pay £34.40 tax on a tax code of 1106L

Yes, my total earnings from last tax year was certainly under £10,600. I have been employed in the past few years but part-time. The £921.67 now makes sense to me since that's per month, thanks for clearing that up. I have completed two self assessements before but I've never had to pay any tax since I was always under the limit. This year is different and last tax year I've paid tax when I wasn't suppose to. Can I complete my self assessment without my P60? I am not sure why I haven't received it yet, should I ask my line manager?

Darksparkle

gohan2091 wrote: »

Yes, my total earnings from last tax year was certainly under £10,600. I have been employed in the past few years but part-time. The £921.67 now makes sense to me since that's per month, thanks for clearing that up. I have completed two self assessements before but I've never had to pay any tax since I was always under the limit. This year is different and last tax year I've paid tax when I wasn't suppose to. Can I complete my self assessment without my P60? I am not sure why I haven't received it yet, should I ask my line manager?

But when you have completed you SA in the passed, have you not completed the employment section?

P60s don't need to be provided until 31st May. You can complete your return without it if you know the correct figures to use.

gohan2091

Yes, I completed the employment section but tax owed was always 0. I am unsure I can complete this without my P60 so I will ask when I can expect to get it. Thanks for the comments