M1 tax help

zagfles

timmins91 said:

It looks like the new role taxed me incorrectly in Sept and is 'making up for it' in October - my q is, is it normal to take that back in one pay period, or is it usually corrected by a tax code change over the coming months?

They didn't tax you incorrectly, they used the emergency code as they're supposed to, see https://www.gov.uk/tax-codes/emergency-tax-codes

As above, you shouldn't be worse off over the 2 months. Either you had more total pay than usual in Sept, or you were paid about the same but paid less tax than usual in Sept. That was corrected in Oct.

Dazed_and_C0nfused

zagfles said:

timmins91 said:

It looks like the new role taxed me incorrectly in Sept and is 'making up for it' in October - my q is, is it normal to take that back in one pay period, or is it usually corrected by a tax code change over the coming months?

They didn't tax you incorrectly, they used the emergency code as they're supposed to, see https://www.gov.uk/tax-codes/emergency-tax-codes

As above, you shouldn't be worse off over the 2 months. Either you had more total pay than usual in Sept, or you were paid about the same but paid less tax than usual in Sept. That was corrected in Oct.

Spot on, neither employer has done anything wrong it's just an unfortunate consequence of being paid twice in the same tax period.

chrisbur

Have a look at your last payslip from your old job and your first payslip from your new job.  Usually a payslip will show a month number on which the tax is calculated what is the month number on these payslips; if the number is the same then both payments were made in the same tax month so you were given tax allowances for both which meant you had underpaid tax.  Your annual tax allowance is divided by 12 and you get 1/12 for each month, if you have had two payments in a month you are getting 13 payments in this tax year so somewhere you have to have a month with no tax allowances.

If your payslips have no month number check the dates of payment, a tax month begins on the 6th of one month and ends on the 5th of the next.  Did you get paid by the old and new employer within a period from the 6th of one month to the 5th of the next.

If you want your tax position to be checked you need to give from your last patslip your taxable gross to date, tax paid to date, tax code and month number or date of payment.

houghton91

Thanks for your help. Rang HMRC and after 50 mins on hold they said new employer had used the incorrect code. We shall see!

Dazed_and_C0nfused

timmins91 said:

Thanks for your help. Rang HMRC and after 50 mins on hold they said new employer had used the incorrect code. We shall see!

On a previous post you said this,

I was put on 1257LM1

That is the emergency tax code (1257L) operated on a non cumulative basis (M1).

Which is perfectly correct for a new employment which is your only or main job and you don't yet have a P45.  

What tax code do HMRC think should have been used?

houghton91

Dazed_and_C0nfused said:

timmins91 said:

Thanks for your help. Rang HMRC and after 50 mins on hold they said new employer had used the incorrect code. We shall see!

On a previous post you said this,

I was put on 1257LM1

That is the emergency tax code (1257L) operated on a non cumulative basis (M1).

Which is perfectly correct for a new employment which is your only or main job and you don't yet have a P45.  

What tax code do HMRC think should have been used?

HMRC sent a new code after September’s pay date - I was referring to October being the incorrect tax code. 

Dazed_and_C0nfused

Did the new tax code include a deduction for tax underpaid?

If so then you might want to ask them to recalculate the code as your new employer is probably ahead of the game by using the P45 and that underpayment will no longer exist (hence the extra tax deducted this month).