Self assessment return shows I owe more tax than I was expecting?

richd70

I have just filled in my self assessment (v late, I know) and got to the end but when I clicked on 'View your Calculation' it told me that I owe much more than I was expecting. I'm usually pretty straightforward - I have 1 job, which is a normal PAYE, then there's a bit of building society interest (1500), some charity payments and a some very small dividend income. From looking at the summary, it looks like the tax my company has paid maybe is low, but how could that be? My tax code is different from last year, for some reason, it says it shows it as 1106T, does this look odd? I pay 12% of my salary into my pension, but wasn't sure where to fill that in on my tax return, would that make a difference? I get critical illness cover and private medical and pay BIK tax (according to my payslips), does that need to be added to the tax return? Any help would be appreciated.
Thanks

Dazed_and_C0nfused

Your tax code is just a provisional attempt to collect the correct tax, it is your Self Assessment return which finalises matters.

Have you used your P60 figures for both pay and tax deducted?

How much were you expecting to be charged on the interest and how much has been charged?

Did you get a P11D or does your employer tax the benefits through payroll (as opposed to a tax code reduction)?

How was the 1106T tax code made up?

I suspect the possible reason for the tax owed is your "adjusted net income" is much greater than was estimated.

richd70

Hi, thanks for the quick reply. I have used the figures from my P60, plus, when I logged into GOV.UK to fill in my tax return, it already had the numbers from my company (which always surprises and impresses me!).
I didn't receive a P11D, I believe my employer taxes the benefits through payroll ( on my monthly payslip I see Critical Illness (BIK) £10.77 and PMI (BIK) £86.35).
Not sure how my tax code is made up, I assume it's some sort of magic that happens between my payroll dept and HMRC?
Tax on interest seems to add up - I received about £1500 in interest. It shows £500 was at 0% and £1000 was at 40%, so a total tax of £400.

Dazed_and_C0nfused

How much Personal Allowance is included in the calculation?

calcotti

Might be worth comparing the figures you are now entering with those on your last Notice of Tax Coding which explain how the tax code was arrived. 

richd70

Dazed_and_C0nfused said:

How much Personal Allowance is included in the calculation?

Personal allowance doesn't seem to be shown? There is an amount that is charged at 'Basic rate' 20% and the rest is at the higher 40% rate. You're right, shouldn't there be a personal allowance which has no tax charged on it? That's weird.

richd70

calcotti said:

Might be worth comparing the figures you are now entering with those on your last Notice of Tax Coding which explain how the tax code was arrived. 

Hi, not sure what this is? Where would I find my Notice of Tax Coding?
Thanks

Dazed_and_C0nfused

richd70 said:

Dazed_and_C0nfused said:

How much Personal Allowance is included in the calculation?

Personal allowance doesn't seem to be shown? There is an amount that is charged at 'Basic rate' 20% and the rest is at the higher 40% rate. You're right, shouldn't there be a personal allowance which has no tax charged on it? That's weird.

Then it looks like it is down to your adjusted net income is much greater than was estimated and you have lost your Personal Allowance, hence the large bill.

You need to keep on top of your tax codes (it isn't your employer's responsibility) so first thing to do would be check your current tax code (available on your Personal Tax Account) and if necessary update that with as accurate an estimated pay value as possible.  

You can check your payslips to see what the year to date amount is and add on estimates for January, February and March pay.

[Deleted User]

We need to know what that adjusted net income is. If it is over £125000 the op is £2200 underpaid based on that tax code alone.

richd70

Yes, looking it up it appears you lose your personal allowance if you earn over a certain amount, which I do. But I'm still surprised that my adjusted net income is greater that the estimate as my company knows how much I get paid. The only difference is that I upped my pension contribution (from me) part way through the year, which they wouldn't have known I was going to do. Would that have made the difference? I was expecting to pay about £1500 on my tax assessment, but it is saying £4500

[Deleted User]

The company has no responsibility at all for ensuring that your personal allowance is correct - the code is issued by HMRC and your employer operates it. I think that I erred in my previous post - it should have read £4400, not £2200. You received personal allowances of 11069 against you PAYE income which meant that 11069 was not taxed. It should have been taxed at 40%. That, more or less, accounts for your underpayment. You need to ensure that the same thing does not happen this year.