HMRC - Confusing - Who is right and who is wrong?

Butterfliesarepretty

Hello,

I have not been on moneysaving for a while.
Has anyone had any experience with paying tax back owed from previous years?

I have always worked full time up until July 2016 when I resigned from work with panic attacks and stress.
At that time we moved house to Darwen in September and I started work again part time 25 hours a week for an agency.
Since then I have paid zero tax as I have always worked part time and I am under the threshold. HMRC were notified by my employers at that time.

I have an online account for my tax and my national insurance record. And they were all paid up.

In June this year I received my tax calculation saying I owed tax of £1087.40 from 2016-2017.

In August I received a letter saying I needed to do a self assessment tax return so with all the p45 and p60s and payslips I followed the instructions and entered the figures required.
It then showed that I had overpaid by £322 and this paid straight into my bank account.

As for the £1087.40, I received more letters saying they had adjusted the figure to £1096.00.
So, I phoned in and spoke to someone who told me I owed it and that they would not check with the previous employer. Not very helpful. She promised to send me instructions on how to set up a payment plan and weeks later I still hadnt received them.

So I went to a local tax accountant and she spent an hour with me. She devised a spreadsheet and put in all the figures from the old payslips and p45 and p60 I provided her with from my previous employers (several agencies) and my now permanent part time employer.

She said that the agency I worked with from September 2016 had not notified the HMRC of the previous figure of tax paid at that date and that it was their error but I would still have to pay this back.

This still confused me as from Jan-July I was taxed for working full time and from September 2016 worked 25 hours a week over five days. Since then I worked for other agencies part time and now since 2018 I have a permanent job working 3 days a week earning around £833 a month, not taxed.

Today I rang hmrc to set up a payment plan, they accepted a direct debit of £90 per month until Feb 2021 to pay off the owed tax and the extra £322. The lady said that when I get my next tax calculation letter that if it turns out what I am paying back is incorrect I will be refunded. Also interest is included as its going over 12 months, yet I was only notified in June.:mad:

I just dont get it. One of my friends paid a debt to hmrc straightaway and her tax accountant said hmrc do not have the right to claim unpaid tax when its the employers fault. Her tax accountant is still trying to get it back because he believe she should not have paid it.

Anyone else any stories???

Pennywise

Butterfliesarepretty wrote: »

One of my friends paid a debt to hmrc straightaway and her tax accountant said hmrc do not have the right to claim unpaid tax when its the employers fault.

Sorry, she's wrong. As long as HMRC calculate and inform you within the specified time limits, they can claim it back whatever the reason.

Butterfliesarepretty

Pennywise wrote: »

Sorry, she's wrong. As long as HMRC calculate and inform you within the specified time limits, they can claim it back whatever the reason.

Maybe so but I told her what my accountant said and she said her accountant is like a dog with a bone, wont let it go.

Shes paid it but hes adamant she should not have paid.

Caz3121

what information did you supply to the agency? the P45 from your previous job, fill in new starters form etc...did you have any income between June and September eg taxable benefits
you need to look at your entire income from 6th April 16 to 5th April 17 and total the amount of earnings and tax due for that amount of earnings v's tax paid

Butterfliesarepretty

Caz3121 wrote: »

what information did you supply to the agency? the P45 from your previous job, fill in new starters form etc...did you have any income between June and September eg taxable benefits
you need to look at your entire income from 6th April 16 to 5th April 17 and total the amount of earnings and tax due for that amount of earnings v's tax paid

Yes the p45 was supplied, I didnt find that at the time the tax accountant looked at it, I did send it to her to add on the spreadsheet but she didnt reply. And I did offer to pay the extra time it would take her to investigate but I guess shes not interested.

Between june and september I did get paid what was owed to me in holiday pay etc in august. but I did not work until the end of September and started work part time.

I think that while I am paying this back I will have to print out all the payslips p60s and p45s for that year till April 17 and send it all in to hmrc with a letter to recheck all the figures.

Thats the only thing I can do, as they wont listen to anything I say on the phone.

Thrugelmir

Butterfliesarepretty wrote: »

Also interest is included as its going over 12 months, yet I was only notified in June.:mad:

Onus is on the taxpayer not the HMRC.

This still confused me as from Jan-July I was taxed for working full time and from September 2016 worked 25 hours a week over five days.

What matters is your total earnings within the tax year in total, i.e. 6th April to 5th April. Anything you were paid above the personal allowance for 2016-17 is taxable. Sounds like you were well above that threshold.

snilloct1957

My wife runs her own massage therapy business from home and is a self-assessed taxpayer (sole trader), paying tax on her profits. Up to now I have been filling in her tax form online and thought I had a handle on it. This year I got a mate who is a certified accountant to do it and, through a forensic examination of her accounts, was able to get a tax refund of over £2700. Turns out HMRC had been claiming money for future tax years they weren't entitled to. Don't believe a word of what HMRC says, if they can do this to me, they are doing it for a million other taxpayers as well. Let the professionals handle it and claim your inheritance back.

unholyangel

Butterfliesarepretty wrote: »

Yes the p45 was supplied, I didnt find that at the time the tax accountant looked at it, I did send it to her to add on the spreadsheet but she didnt reply. And I did offer to pay the extra time it would take her to investigate but I guess shes not interested.

Between june and september I did get paid what was owed to me in holiday pay etc in august. but I did not work until the end of September and started work part time.

I think that while I am paying this back I will have to print out all the payslips p60s and p45s for that year till April 17 and send it all in to hmrc with a letter to recheck all the figures.

Thats the only thing I can do, as they wont listen to anything I say on the phone.

That isn't necessarily going to solve anything if they have information in excess of what you have. You need to first identify where the discrepancy is. You said you've got the online tax account and also the calculation for that year, so do the amounts for each employer match what you have? Is there any additional income not accounted for on a p60/p45?

Are you saying you gave the p45 to your new employer? When did the old employer give you the p45? Just wondering if perhaps the old employer have issued the p45 and then processed the holiday pay in a way that has affected your tax liability (perhaps on the record they had already ended).

She said that the agency I worked with from September 2016 had not notified the HMRC of the previous figure of tax paid at that date and that it was their error but I would still have to pay this back.

What does that mean? I'm running through scenarios but after a few dozen, I'm drawing a blank on what would result in you owing the money from previous tax figures supplied by the new employer. If they suddenly zero'd tax paid to date then it would just be for them to send the right figures - you wouldn't actually owe it.

Also are either of your accountants qualified? How long has your friend been waiting for her refund so far?

Pennywise

Pointless to just send HMRC a pile of paperwork. What you need to do is check it yourself (or your accountant). Check the payslips to the P45/P60 for each employment, and then check the P45/P60 to the HMRC annual summary calculations. They'll either all match up or they won't. If they match, you owe the tax. If they don't match, it should be obvious where there is an error and that's what you need to tell HMRC with the relevant paperwork. HMRC aren't going to go through your payslips for you when they think they're right - they'll only act if you can prove they're wrong.

BoGoF

snilloct1957 wrote: »

My wife runs her own massage therapy business from home and is a self-assessed taxpayer (sole trader), paying tax on her profits. Up to now I have been filling in her tax form online and thought I had a handle on it. This year I got a mate who is a certified accountant to do it and, through a forensic examination of her accounts, was able to get a tax refund of over £2700. Turns out HMRC had been claiming money for future tax years they weren't entitled to. Don't believe a word of what HMRC says, if they can do this to me, they are doing it for a million other taxpayers as well. Let the professionals handle it and claim your inheritance back.

Sounds more like a case of you not having a clue what you were doing. HMRC only 'claim money for future tax years' ( also known as payments on account) if the self assessed tax due was over £1000. i.e. it was your incorrect accounts that led to your wife overpaying tax.

Dazed_and_confused

In June this year I received my tax calculation saying I owed tax of £1087.40 from 2016-2017.

In August I received a letter saying I needed to do a self assessment tax return so with all the p45 and p60s and payslips I followed the instructions and entered the figures required.
It then showed that I had overpaid by £322 and this paid straight into my bank account.

As for the £1087.40, I received more letters saying they had adjusted the figure to £1096.00.

I may be barking up the wrong tree here but it reads as though the op has been sent a PAYE calculation for 2016:17 and later, presumably as a result of not paying the tax owed from HMRC's calculation, asked to file a Self Assessment return for the same year.

And the op has now filed the return.

In which case everything that has happened since is irrelevant as you should only have one type of calculation per tax year, either PAYE (usually a P800) or Self Assessment, not both. Basically the Self Assessment will make the PAYE calculation redundant.

Perhaps the op can clarify exactly what has happened as it seems to me they are making a mountain out of a molehill. But there may be information not yet disclosed which puts a different slant on things.