Tax code question

JustAnotherSaver

My mother started work (after some years out) last summer. She recently asked me about her tax code as it seemed she was paying a bit of tax. She's also started paying tax on my dads pension that she receives.


Tax code on her payslip: 205T (W1/M1)
Tax code on the pension slips: 308L M1


I suspect you'll need more info although i don't know what so whatever it is just ask & i'll try to get an answer for you.


She brought it up with her employer and IIRC they said it'll get sorted next tax year.

Dazed_and_confused

How many sources of income does she have?

The tax code suggest this is probably more than the two you have mentioned.

Did the employer say what would be sorted next year? How does her employer know what is right or wrong if your mother, the person concerned, doesn't .

Can you confirm the expected amounts she should receive in the year to 5 April 2019 for each bit of income?

Has she looked at the tax code calculations on her Personal Tax Account? Or any paper notices of coding received?

JustAnotherSaver

Dazed_and_confused wrote: »

How many sources of income does she have?

The tax code suggest this is probably more than the two you have mentioned.

Did the employer say what would be sorted next year? How does her employer know what is right or wrong if your mother, the person concerned, doesn't .

Can you confirm the expected amounts she should receive in the year to 5 April 2019 for each bit of income?

Has she looked at the tax code calculations on her Personal Tax Account? Or any paper notices of coding received?

I'll answer what i know at 11pm on a Sunday night. The rest i'll have to find out.


She has my dad's pension, her job, she used to get DWP EESA benefit but that stopped with her getting a job & she also still gets DWP PIP.


That's it, nothing else.


AFAIK her employer just said her code will be sorted next year. From what i'm told he seems the - i'm really busy, bother me later, type.


Sorry that's as much as i know right now. I'll have to find the rest out.

Dazed_and_confused

She really needs to check how the 308L tax code is calculated.

There is probably some allowances being used against the job (2050'ish) but that leaves a big discrepancy.

£11,850 less £2,050 = £9,800 = tax code 980L, not 308L so the obvious answer would be the ESA as that is taxable.

If she has stopped getting any taxable benefit she should have got a P45 which she can use to compare with the tax code entries.

JustAnotherSaver

Right to give the totals to date (this tax year):


DWP DLA: £2,215.20

the DLA payments appear to stop with the last one being in September 2018, seemingly replaced by DWP PIP from then on
DWP PIP: £1,551.89


DWP EESA: £2,212.80 with the last payment coming in August 2018


My dad's pension: £3,351.17


Her job (up to December 2018's wage):

Total (& taxable) pay: £5802
Tax: £1,022.80
NI Employee: £275.04
NI Employer: £316.29




Does this clarify anything?

Dazed_and_confused

A little. But the crucial thing is for her to find out how the 308L tax code is calculated.

Her taxable benefit (just the ESA I think) is fairly low in relation to the discrepancy in the tax code so it is possible that an adjustment to the tax code is required which may in turn mean there are some more tax allowances which can be allowed against the job.

Which may then reduce the tax needing to be paid on the job.

If the ESA has stopped did she receive a P45 from DWP showing the taxable benefit to when her claim ended?

That might be something HMRC will need (though they should have got a copy from DWP I think).

Has she started to get a State Retirement pension after her ESA stopped?

JustAnotherSaver

Dazed_and_confused wrote: »

Has she started to get a State Retirement pension after her ESA stopped?

I'd doubt it. I've seen her bank statements and the only income is what i've mentioned. She's not yet 60.


I'll ask her regards the P45.

Dazed_and_confused

It might be something as simple as HMRC have assumed she is continuing to get ESA (an annual amount) and if this has now ended there will almost certainly need to be a revision to her tax code(s).

JustAnotherSaver

She did receive a P45 or so she thinks. She had to give a copy to her employer and keep one for herself as far as she can remember. I've asked her to see if she can find it in case there's anything on there that you'd need to know to help further.


Now she mentions it i'm pretty sure i remember one coming through.

LilElvis

To be honest, with multiple sources of income this tax year, coupled with commencements and cessations, this is not going to be reconciled via tax code adjustments for 2018/2019. Speak to HMRC but I expect that completing a self assessment return for her in a few months is the only way that you will be able to ensure that all of her earnings figures are brought together for a final calculation and refund.

If you could post what her gross earnings are going to be from this April onwards I'm sure forum members can advise how to get her tax allowance allocated so as to make any end of year adjustment minimal.

JustAnotherSaver

My mother says she’s previously been in touch with HMRC regards her tax code and they say that it’s correct?

She just seems to be paying quite high tax for what she’s earning that’s all.