New(ish) Job and paying too much tax

theatretony

Could be a long one...
I changed jobs in October and during that time i have had 3 (soon to be 4) tax codes. They say i have underpaid this year and are clawing it back through my last few months pay. Now I used to be self assessment for mileage (used to get 17p a mile now get 45p), but no longer self assessement for this tax year.
My tax code from April to Oct was 1543L, the it went to 1298L M1 and now it is K101 M1.  And next month it will be 908L.  Now i would assume that as I have no taxable benefits my tax code would revert  to 1250L, or something near to reclaim the tax up to the financial year end. I have spoken to HMRC today and they said the calculations are correct, here is how i calculated it (actual figures)
Month               Salary           Tax             Cumulative

April	2,907.70	325.60
May	2,907.70	325.60	651.20
June	2,907.70	325.60	976.80
July	2,907.70	325.60	1,302.40
August	2,907.70	325.60	1,628.00
September	2,907.70	325.60	1,953.60
October	3,468.29	216.92	2,170.52 (reason for lower tax, 2 payslips that month)
November	3,083.34	400.00	2,570.52
December	3,083.34	400.00	2,970.52
January	3,083.34	642.20	3,612.72
February	3,208.33	692.20	4,304.92
March	3,208.33	489.80	4,796.72

The March figure is what HMRC said i would be paying hence why lower. HMRC said they were trying to claim back £556 (no idea where from). There are some pensions deductions to account for (127 for Apr-Oct) and the 70 for the remainder
So in total, over the year I will have paid 4796 in tax on 36581 salary. Now if i was on 1250L as i have zero taxable deductions like mileage or company car, I should have only paid 4586 in tax, which works out at 208.72 overpayment.  But HMRC say I should have paid 4796 which i think is wrong.  
Hope that makes sense to anyone, I think I am right that I am paying too much, but HMRC think otherwise but cannot give a decent explanation why.
Can anyone shed any light on this!! Thanks

CSL0183

£36,581 in England/Wales/NI would pay £4,816.20. In Scotland £4,912.06. This is presuming a flat 1250L tax code and no salary sacrifice/pension. Where are you getting £4,586 from?
https://www.thesalarycalculator.co.uk/salary.php

There is no human working these figures out, they are all calculated automatically. Chances are for a given salary, they will be right and it will be your own maths to blame? Not sure I would be wholly fussed with a £208 over payment, to the point where I was questioning HMRC. If it is an overpayment, you will get it back in a rebate next year or an adjustment to your tax code.

theatretony

CSL0183 said:

£36,581 in England/Wales/NI would pay £4,816.20. In Scotland £4,912.06. This is presuming a flat 1250L tax code and no salary sacrifice/pension. Where are you getting £4,586 from?

https://www.thesalarycalculator.co.uk/salary.php

Sorry, just realised i did not calculate in pension contributions, which over the year is 1147 (around 3.6%) so it should be £4625.65 in tax using a 1250L code....

CSL0183

It's been a pretty complicated tax year with various tax codes. I would trust that the figures are correct and if not you will get it back in a rebate. I certainly wouldn't be losing sleep or scratching my head, wasting time and phoning HMRC over the "missing £170". Trust the computers that if there has been an overpayment you will get it back in a few months time.

theatretony

CSL0183 said:

It's been a pretty complicated tax year with various tax codes. I would trust that the figures are correct and if not you will get it back in a rebate. I certainly wouldn't be losing sleep or scratching my head, wasting time and phoning HMRC over the "missing £170". Trust the computers that if there has been an overpayment you will get it back in a few months time.

Lets so lol...
I think because i went from self assessment to 'normal' would not have helped. The scary bit was losing just under £300 a month take home for the last two payslips! Quite a bit to lose from your salary in one go...

molerat

It looks like you didn't pay enough tax in October due to the job change and getting double the monthly allowance so you are catching up now.  When did you give your P45 to the new employer ? To pay £325.60 tax in England on a 1250 code you would have a taxable pay of £2671 so what allowable deductions have you got from that £2907.70 ?  Without a complete breakdown of each payslip we can only guess.

theatretony

molerat said:

It looks like you didn't pay enough tax in October due to the job change and getting double the monthly allowance so you are catching up now.  When did you give your P45 to the new employer ? To pay £325.60 tax in England on a 1250 code you would have a taxable pay of £2671 so what allowable deductions have you got from that £2907.70 ?  Without a complete breakdown of each payslip we can only guess.

On the 2907.70 I was on a tax code of 1543L. The October breakdown was 1760.62 Gross with 100.40 tax with 1543L and the new job paid 1687.67 with 116.52 tax.

chrisbur

theatretony said:

molerat said:

It looks like you didn't pay enough tax in October due to the job change and getting double the monthly allowance so you are catching up now.  When did you give your P45 to the new employer ? To pay £325.60 tax in England on a 1250 code you would have a taxable pay of £2671 so what allowable deductions have you got from that £2907.70 ?  Without a complete breakdown of each payslip we can only guess.

On the 2907.70 I was on a tax code of 1543L. The October breakdown was 1760.62 Gross with 100.40 tax with 1543L and the new job paid 1687.67 with 116.52 tax.

That is a strange tax figure (pence are usualy .00  .20  .40  etc) ; are you sure that was not national insurance?
What is the tax paid to date figure from your payslip.
Regarding pension 
The figures that you quote are near enough spot on for tax ( one or two are a few pence out ) to suggest that either the gross you quote is taxable gross or your pension schemes do not have tax adjusted in your wages but collect extra from HMRC and add this to your pension pot.  Either way you cannot adjust these figures for your pension payments.,

As advised if code is correct on 1250L then actual tax paid if anything is a bit to low.

unholyangel

theatretony said:

molerat said:

It looks like you didn't pay enough tax in October due to the job change and getting double the monthly allowance so you are catching up now.  When did you give your P45 to the new employer ? To pay £325.60 tax in England on a 1250 code you would have a taxable pay of £2671 so what allowable deductions have you got from that £2907.70 ?  Without a complete breakdown of each payslip we can only guess.

On the 2907.70 I was on a tax code of 1543L. The October breakdown was 1760.62 Gross with 100.40 tax with 1543L and the new job paid 1687.67 with 116.52 tax.

This one bit of info (along with you previously being in self assessment) provides the answers I think, although the figures are still slightly off - that could potentially be due to pensions, payrolled benefits, being paid 4 weekly instead of calendar monthly or even a combination of those. . 

You were previously claiming expenses/relief of some kind which increased your tax free allowance. Due to apportioning (the way PAYE is calculated), you were getting 15439/12 = £1286 personal allowance from April till Oct with your old employer. I would hazard a guess this came from self assessment so when you removed yourself from self assessment and told them you wouldn't be incurring the same again this year, they sent an amended tax code without that extra relief. Once that relief was removed, it retrospectively meant that while you received a tax free allowance of £1286 per month, you should have only received £1042. Which would create an underpayment of ~£293 from Apr till Sept. Then in October there was an underpayment of ~£268 (because both employers gave you a tax free allowance that month AND because you were still receiving that extra relief from your old employer in Oct). 

The Nov & Dec I would wager was the emergency 1250L non-cumulative code from statement B on the p46 (if your old employer had paid you Oct, you wouldn't have had a p45 to give the new employer). The code to collect the underpaid tax due to the excess relief wasn't issued/used until January and appears to have been a K code. Presumably they have now issued a different code for March if its only going to be deducting £489 from £3208.