Previous Employer over-stated tax

nick74

sheramber said:

They have no incentive to amend anything as they have their money back. 

Although the employer perhaps thinks they have received all of their money back, that's not quite correct. In addition to the tax and employees NI deducted from the bonusses they will almost certainly have paid 13.8% employers NI on top of the whole lot. That makes the employer still £2,691 out of pocket until they make the correction with HMRC. The trouble is the OP's complaints don't so far appear to have reached anyone knowledgeable or senior enough to know/care about that.

Unfortunately I get the impression that many payroll departments are now staffed by people who are basically just software data inputters, with very little understanding of how tax and NI should work.

Thrugelmir

ClaireLH1978 said:

They did however finally reply to me email dated 17 August yesterday and said they will send a correction to HMRC first week of September.....although I was promised the same last month... We will see.

Your ex employer has acknowledged the issue then. Perhaps they need to find a workaround themselves for what is an extremely unusual situation. They'll be few staff in the payroll team with the ability or authority to resolve this. It will need to be processed through the month end payroll together with the all the normal activity.  As much as it's a priority to you, to them it's not unfortunately. 

Dead_keen

Technically, the employer should not adjust the payroll for this.  If you were required to pay the gross amount back and you did then you should claim the income tax back from HMRC. That is your responsibility, not the employer's.

You can't get the NIC back.

To find out more, google: HMRC "julian martin".  The Julian Martin case is about an employee who was required to repay a sign-on bonus.  Your facts seem similar. 

ClaireLH1978

Dead_keen said:

Technically, the employer should not adjust the payroll for this.  If you were required to pay the gross amount back and you did then you should claim the income tax back from HMRC. That is your responsibility, not the employer's.

You can't get the NIC back.

To find out more, google: HMRC "julian martin".  The Julian Martin case is about an employee who was required to repay a sign-on bonus.  Your facts seem similar. 

I am trying to claim it back from HMRC-but at the minute HMRC has no correction from employer to say they declared paying me more than they did following my re-payment. And the next issue is the P45-they continued paying me despite me calling HR, then demanded that back too, which I paid, but they did not adjust my P45 so as far as HMRC are concerned I worked an additional 2 months and were paid for those, and so now I am paying higher rate tax when I shouldn't be.
Will take a look now at 'Julian Martin' thank you 

Dead_keen

OK.  There's a difference.  If they overpaid you and then claimed that back, that is a payroll mistake and the employer should correct that.

The tax on the bit you were required to pay back (i.e. not the mistake) has nothing to do with the employer and that's where Julian Martin comes in.

nick74

Dead_keen said:

Technically, the employer should not adjust the payroll for this.  If you were required to pay the gross amount back and you did then you should claim the income tax back from HMRC. That is your responsibility, not the employer's.

You can't get the NIC back.

To find out more, google: HMRC "julian martin".  The Julian Martin case is about an employee who was required to repay a sign-on bonus.  Your facts seem similar. 

Interesting. I wasn't aware of that case, but yes it makes perfect sense. In summary at the time the bonus was paid it was not an error, therefore the tax and NI were deducted correctly so there is nothing to correct as far as the employer is concerned. Based on that the OP does need to reclaim the tax from HMRC as the repayment of the bonus was an 'employment loss'.

ClaireLH1978

At this point I would just be happy for this current tax years earnings to be amended.

Thank you everybody, I will re-attack Monday as they promised all to be sorted first week of September