Wrong date on P45 from Pension provider..this will affect amount of tax paid. they refuse to correct

Merlin29

Thanks for taking the time to respond.
This is slightly different to your situation. this is referring to  a lump sum pension payment being allocated to the wrong tax year. It will mean I will be taxed at 40% instead of 20% due to the error made.

Dazed_and_C0nfused

The payment date and leaving date supplied by the pension company are matters of fact.

Have the pension company explained why they have reported these dates as 8 April 2021(?) rather than the date you believe to be correct (1 April 2021?)

sheramber

Merlin29 said:

Thanks for taking the time to respond.
This is slightly different to your situation. this is referring to  a lump sum pension payment being allocated to the wrong tax year. It will mean I will be taxed at 40% instead of 20% due to the error made.

That doesn't mean that the pension company may only have one payment date a month. When I drew out a lump sum, my pension company  payment dates were once a month   Similar to a company payroll.

Unfortunately, in your case the date enters a new tax year. Mine was January so it didn't matter.

Rather than asking them to change the date have you asked them why they used the 8th as a payment date when they paid it into the bank on 1st?

Merlin29

Hi,
Many thanks for responses.

Dazed and Confused your help has been invaluable.  to recap, the payment date that they reported was incorrect .. but they were refusing to change it.. When I sent off an email asking for it to be corrected this was their response.

I do understand that you had received a payment in your bank on 31 March 2021, but this payment was processed as a manual payment and not through the HMRC System.

 

The HMRC system will have a process date of 8 April 2021, after the 2020/2021 tax year.  

If we amended the P45 as you have requested, this would be providing false information to HMRC, and I’m sorry this is not correct.... ..

pretty unbelievable or what???
so I emailed back the following...

I refer you to the error you have made in instructing HMRC. Payment date was 1st April 2021.  HMRC should have been given this as the payment date.

I have looked at the Government website advising how to amend Payrolls if wrong payment dates and wrong leaving dates have been entered. 

www.gov.uk/payroll-errors/correcting-your-fps-or-eps  

You made a mistake in your FPS or EPS 

Your PAYE bill might be wrong if you made a mistake in your FPS or EPS. You might have to correct: 

·         payment dates 

·         start or leaving dates for your employee 

Correct an employee’s start or leaving date  

Update your payroll records with the correct date if you put the wrong start or leaving date for an employee in your FPS. 

As you have reported the income in the wrong tax year, then I believe you need to file two corrections, 

 1). An update to 2021:22 reducing the pay (pension) and tax reported to NIL. 

2). An update to 2020:21 reporting the pay (pension) and tax deducted.  

Your lack of competence and care will mean that I will charged incorrectly at 40% tax rate in year 21/22. 

I  copied in their CEO and also advised that I would contact Tony Hazell of the Daily Mail to take up the complaint on my behalf. They received my email yesterday. Today, I received the following from them.

Thank you for your patience while this has been investigated further. 

Please find attached the 3 parts of the P45 with the payment date of 1 April 2021. 

I will be contacting HMRC to do an earlier Year Update so they have the correct details on their system.

What a turnaround!. ..no nod to their mistake etc but at least they have now put it right.

So thank  you 😊.

Dazed_and_C0nfused

Great result 

I would suggest leaving them to do that is the best thing to do now but I would check your PTA again in a few weeks.

I will be contacting HMRC to do an earlier Year Update so they have the correct details on their system.

That in itself will only report the income and tax deducted for 2020:21.  They would also need to file an amended submission for 2021:22 reducing the income and tax to £0.

Which they probably will but worth keeping an eye on.

unholyangel

sheramber said:

Was the amount calculated to 8 April?

I was paid my salary to the last day of the month but it went into the bank on the last  working day of the month so most months it was paid into  the bank   before  the actual payment date.

Employment income is taxable on the date it is paid or on the date you were entitled to be paid, whichever is the earlier of the two. 

Therefore your whole wage would have fallen taxable on the date payment was made. The fact the wage covers a period extending beyond the payment date doesn't even come into it. 

unholyangel

I think there's some misunderstandings here.

A p45 does not report when a payment was made. RTI does that. A p45 reports the end date of the employment/pension and any earnings received/tax paid during that tax year. 

So, what exactly has happened?