What's it mean when you've got C.U.M. on your DB pension payslip?

molerat

itsmeagain said:

molerat said:

Did you give the P45 to the pension payer ?

No. The employer gave it me when I left. I can still see it on their own system now. My company payroll team ARE the pension payroll team. It would be like giving it back to the person that gave it me in the 1st place.
But my understanding is that HMRC issues the tax code to the payroll. They must have had the P45 months ago also, plus known my previous income/employment. So, i still don't know what an extra month would have told them that they didn't already know in order to issue the correct tax code/basis?

Irrespective of them being the same people they became a new employer once they had given you a P45, you could have taken that P45 elsewhere to a new job, you should have given it back to them.  HMRC will only issue a code once they receive notification of someone starting employment which is after the first payment has been made and payroll are bound to issue a tax code as laid down in the PAYE manual until they receive a P45 or notification from HMRC.

itsmeagain

molerat said:

itsmeagain said:

molerat said:

Did you give the P45 to the pension payer ?

No. The employer gave it me when I left. I can still see it on their own system now. My company payroll team ARE the pension payroll team. It would be like giving it back to the person that gave it me in the 1st place.
But my understanding is that HMRC issues the tax code to the payroll. They must have had the P45 months ago also, plus known my previous income/employment. So, i still don't know what an extra month would have told them that they didn't already know in order to issue the correct tax code/basis?

Irrespective of them being the same people they became a new employer once they had given you a P45, you could have taken that P45 elsewhere to a new job, you should have given it back to them.  HMRC will only issue a code once they receive notification of someone starting employment which is after the first payment has been made and payroll are bound to issue a tax code as laid down in the PAYE manual until they receive a P45 or notification from HMRC.

Thanks for your efforts but I genuinely don't understand. Why did they become my new employer once they gave me the P45? Surely they became my old employer? Or are you saying that they became my old employer and pension re-employer in the same day?

The instructions given to me by the old employer & the pension admin team working for the employer, never requested my to give it them back.

My pension is also back dated to the date that I left/retired.

Not wishing to be pedantic, but my code has not changed, it's the 'basis' box that's changed. So are you saying that the pension payroll team chose a 'basis' from a 'manual' that they know is most likely wrong, before they got it corrected by HMRC when they issued the correct basis to the employer?

Anyway - are we saying that there's no harm done because it's all been corrected by using the corrected 'basis' on the 2nd payslip?

squirrelpie

itsmeagain said:

Or are you saying that they became my old employer and pension re-employer in the same day?

Exactly that. Most people have different people paying their pension to whoever paid them whilst they were working, because pensions are run separately from businesses/organizations that employ people. Quite deliberately because there were many occasions when companies effectively stole people's pensions so they were forced to be separate. I expect it's separate people even in your employer's payroll department.

Anyway - are we saying that there's no harm done because it's all been corrected by using the corrected 'basis' on the 2nd payslip?

Yes, that's how it should work. At least by the end of the tax year you should find you've paid the correct amount of tax. You can post the detailed numbers if you can't see how it all works out and somebody will check them for you.

Dazed_and_C0nfused

1257L is the emergency tax code.

If this is operated on a cumulative basis then the employer/pension payer calculates the tax due at the week/month of the latest payday i.e. 31 December paid monthly is tax month 9 using the total taxable pay/pension details they hold which could include previous employer(s).

If they operate it on a non cumulative (week 1/month 1) basis then they only consider the taxable pay they are paying in that one period and ignore anything from previous pay periods.

Dazed_and_C0nfused

Not wishing to be pedantic, but my code has not changed, it's the 'basis' box that's changed. So are you saying that the pension payroll team chose a 'basis' from a 'manual' that they know is most likely wrong, before they got it corrected by HMRC when they issued the correct basis to the employer?

Employers/pension payers will normally allocate an initial tax code and basis of operation based on either a new starter declaration or the guidance in CWG2 (Employers Further Guide to PAYE & NIC).

That will be the correct code/basis of operation for the first payment.