PAYE

AskAsk

sfowler49 said:

No, and as I say I already get taxed off my normal salary, this was because my income jumped that I ended up paying less through paye. I've no idea why I have to go through the self assessment process, and would like to know if everybody who's had to pay back child benefit has had to do the same.

in that case, it would sound like they haven't asked you to pay in advance for the tax year 2019/20, which is the normal process if you did self assessment.  this is probably because you don't have any other income on top of PAYE.  so if your earnings from work during the tax year 2019/20 have been stable, then there shouldn't be any tax owed I am guessing.

HMRC can ask anyone to complete a self assessment return.  They tend to do so when they believe that tax is owed and so they want to make sure that they find out all of the tax that may be owed and not just what they have identified.  They will continue to ask you to do self asessment until they are satisfied that you no longer need to do one.

If you don't owe them tax every year, then soon they will get bored with you and tell you that you won't need to complete a self assessment form any more, but until then, they will continue to send you a request each year to complete your self assessment.

sfowler49

Yes earnings for that year were virtually identical to the previous year, so if what you're saying is right hopefully I will only have the child benefit overpayment to repay.
Thanks for the help today, it's really appreciated 

AskAsk

sfowler49 said:

Yes earnings for that year were virtually identical to the previous year, so if what you're saying is right hopefully I will only have the child benefit overpayment to repay.
Thanks for the help today, it's really appreciated 

when you did the tax return for the tax year 2018/19, they would have informed your employer of your new tax code for the tax year 2019/20.  this would have taken into account your new increased pay, so you should be fine this time round when you do your self asessment, which you should get going doing by the way as the deadline is 31.01.2021, but really try to do it by the end of next month.  i always do mine before the end of december.

the reason you have been asked to do self assessment is because of the increase in salary rather than the child benefit i believe.  and if your salary remains stable, they will soon forget about you.  but if you find that after a couple more years and there is little or no additional tax to pay on your self asessment, then call HMRC and ask them if you could be exempt from having to do self assessment, if you find they continue to pester you each year with a request to complete the return.

68ComebackSpecial

AskAsk said:

sfowler49 said:

Yes earnings for that year were virtually identical to the previous year, so if what you're saying is right hopefully I will only have the child benefit overpayment to repay.
Thanks for the help today, it's really appreciated 

when you did the tax return for the tax year 2018/19, they would have informed your employer of your new tax code for the tax year 2019/20.  this would have taken into account your new increased pay, so you should be fine this time round when you do your self asessment, which you should get going doing by the way as the deadline is 31.01.2021, but really try to do it by the end of next month.  i always do mine before the end of december.

the reason you have been asked to do self assessment is because of the increase in salary rather than the child benefit i believe.  and if your salary remains stable, they will soon forget about you.  but if you find that after a couple more years and there is little or no additional tax to pay on your self asessment, then call HMRC and ask them if you could be exempt from having to do self assessment, if you find they continue to pester you each year with a request to complete the return.

It's the reverse. A higher PAYE income doesn't usually require a self assessment if this is the sole change, but is required if adjusted income exceeds £50k and child benefit is being claimed.

AskAsk

68ComebackSpecial said:

AskAsk said:

sfowler49 said:

Yes earnings for that year were virtually identical to the previous year, so if what you're saying is right hopefully I will only have the child benefit overpayment to repay.
Thanks for the help today, it's really appreciated 

when you did the tax return for the tax year 2018/19, they would have informed your employer of your new tax code for the tax year 2019/20.  this would have taken into account your new increased pay, so you should be fine this time round when you do your self asessment, which you should get going doing by the way as the deadline is 31.01.2021, but really try to do it by the end of next month.  i always do mine before the end of december.

the reason you have been asked to do self assessment is because of the increase in salary rather than the child benefit i believe.  and if your salary remains stable, they will soon forget about you.  but if you find that after a couple more years and there is little or no additional tax to pay on your self asessment, then call HMRC and ask them if you could be exempt from having to do self assessment, if you find they continue to pester you each year with a request to complete the return.

It's the reverse. A higher PAYE income doesn't usually require a self assessment if this is the sole change, but is required if adjusted income exceeds £50k and child benefit is being claimed.

the OP's salary spiked during the tax year so the tax code that the employer had been given may have put the OP in the basic rate tax band, and when the spike came along mid year, it pushed the OP into the higher rate tax band.  the employer may have continued to tax at the band given to them and so at the end of the tax year, there was a demand due for tax owed.

my colleague earned a lot more than 50k and he was claiming child benefit as he had 2 young children.  he never had to complete a tax return until one year out of the blue, HMRC asked him to do a self assessment return.  they had decided that he should do so and it wasn't because of any tax due.

he complained to me that he was being picked on by HMRC and i told him i thought everyone who was a high rate tax payer had to do a self assessment.  he said this wasn't the case as he had been a high rate tax payer for a very long time and he never had to do any self assessment.

he did it for a couple of years, but then he wrote to HMRC to ask that he be exempt as there was never anything to pay in addition on the return, and they agreed to take him off their radar.

68ComebackSpecial

AskAsk said:

68ComebackSpecial said:

AskAsk said:

sfowler49 said:

Yes earnings for that year were virtually identical to the previous year, so if what you're saying is right hopefully I will only have the child benefit overpayment to repay.
Thanks for the help today, it's really appreciated 

when you did the tax return for the tax year 2018/19, they would have informed your employer of your new tax code for the tax year 2019/20.  this would have taken into account your new increased pay, so you should be fine this time round when you do your self asessment, which you should get going doing by the way as the deadline is 31.01.2021, but really try to do it by the end of next month.  i always do mine before the end of december.

the reason you have been asked to do self assessment is because of the increase in salary rather than the child benefit i believe.  and if your salary remains stable, they will soon forget about you.  but if you find that after a couple more years and there is little or no additional tax to pay on your self asessment, then call HMRC and ask them if you could be exempt from having to do self assessment, if you find they continue to pester you each year with a request to complete the return.

It's the reverse. A higher PAYE income doesn't usually require a self assessment if this is the sole change, but is required if adjusted income exceeds £50k and child benefit is being claimed.

the OP's salary spiked during the tax year so the tax code that the employer had been given may have put the OP in the basic rate tax band, and when the spike came along mid year, it pushed the OP into the higher rate tax band.  the employer may have continued to tax at the band given to them and so at the end of the tax year, there was a demand due for tax owed.

my colleague earned a lot more than 50k and he was claiming child benefit as he had 2 young children.  he never had to complete a tax return until one year out of the blue, HMRC asked him to do a self assessment return.  they had decided that he should do so and it wasn't because of any tax due.

he complained to me that he was being picked on by HMRC and i told him i thought everyone who was a high rate tax payer had to do a self assessment.  he said this wasn't the case as he had been a high rate tax payer for a very long time and he never had to do any self assessment.

he did it for a couple of years, but then he wrote to HMRC to ask that he be exempt as there was never anything to pay in addition on the return, and they agreed to take him off their radar.

that's not how a tax code works - there is no adjustment needed for becoming a higher rate tax payer and no new notice of coding needs to be issued. Payroll software automatically calculates the tax due at all rates. Your friend was "picked on" because he/ his partner was claiming a benefit he wasn't entitled to because of his earnings - money that he would have had to repay after notifying HMRC of his taxable earnings via self assessment. Many higher earners are now falling foul of their non-disclosure, often after several years and with many thousands to repay. The onus is on the taxpayer to evaluate whether they are liable for additional tax, or wait for HMRC to question it and potentially levy penalties and interest on top. Presumably your friend, after being made aware of his liability, stopped claiming the benefit, had no other taxable earnings that require declaration and the need for self assessment was removed.