Son Overpaying Income Tax

chilluk7

My son suspected he was overpaying his income tax, so checked a few online calculators and it seems he has been overpaying to the tune of 300%. He went through the HMRC overpayment reports and they suggested it would be refunded via his wages.

Today he received a letter saying his tax code had changed from 293T to 1257T - I'm not sure what the old code referred to, but I understand at least the allowance part of the new one. However when searching I'm thinking he should be on an L code not a T? He has one job, and certainly earns far less than £100k!

As an illustration he has been hit with approx £240 a month Income Tax on a gross of £1450. Online calcs suggest about £80 based on newest tax code. His company do pay small bonuses if they hit recycling targets etc, not sure if that would / has clouded it.

So I guess my questions are (a) is he on the correct tax code, and (b) if he has overpaid how can he make sure he gets back what is owed to him?

Many Thanks

Dazed_and_C0nfused

You really to provide the breakdown of how tax codes (the 293T and 1257T).

As far as any refund is concerned that depends on whether the tax code was issued on a cumulative or non cumulative basis.

What tax code was being used in the previous tax year?

chilluk7

Thanks for your reply - not sure what you mean by provide a breakdown of the tax codes? Let me know what info I need to give and I will share it.

He only started in March/April so there isn't really a history for the previous tax year unfortunately.

Dazed_and_C0nfused

A tax code can be made up of various elements, for example  Personal Allowance, company benefits, pension tax relief, interest etc (the list is endless!!).

The end result is the tax code i.e. 293T.

It may simply be that his income was estimated far too high reducing his Personal Allowance but that's not something that is a common occurrence going off what is posted on here.

chilluk7

Ah I see - I'll ask him if he has anything to show that sort of info. I think you are right though I regarding the estimated earnings. If that is the case how does he go about getting anything owed to him - via his own work, or via HMRC?

Edit - that latest 1257T code seems to be just Personal Alloawance.

Dazed_and_C0nfused

If the only tax overpaid is for the current year and the new tax code was issued on s cumulative basis then it will be repaid by his employer the first time they use the new tax code.

He can probably check his Personal Tax Account on gov.uk for details of his previous tax code.

sheramber

If he only started at the start of current tax year it is possible that his previous employer had not reported that he had   ceased. employment.

As a result  HMRC issued as code based on him  appearing to have started a second job so they restricted his personal allowances.