Incorrect Tax Codes

jacqbird

• My colleague and I have worked for the same company for over 10 years The company was run as a Sole Trader Company. As of 1st Jan 2023, the company became a Ltd Company (under a new name) and the Sole Trade company ceased to exist. Now the fun starts! Our boss has decided he knows what he’s doing regarding HMRC but has made a really big mess of things for us. At one point on the HMRC App was showing that my Salary for 23-24 was 1.7 Million! We spoke to our Boss, who initially said it’s the fault of HMRC, we spoke to HMRC and the error is in his court, it seems we are working for the new company twice! It’s a bit more involved but just a complete mess. Boss has spoken to HMRC who’ve said it could take 3 years to sort, but in the meantime, because of our current tax codes, we are being told by HMRC we  owe them money, myself to the tune of 17K and my colleague  6+K. Our wages are being paid at the same rate as previous so it’s not causing us a direct financial issue, but we do have these figures over our head that HMRC are trying to claim, and technically should be taken from our wages. 

•  It is causing me a financial issue because the tax code means my small pension is being taxed at a higher rate, and my colleague  is unable to release a small pension because her current tax code and money she supposedly owes would mean she’s left with net to nothing. 

•  On top of all this, we’ve found out indirectly that the Boss is trying to sell the company!

•  . The attitude of our Boss is that, he’s done what he can. I just want to find out where we can deal with this, or if there’s an organisation we can speak to who can help, just to be pointed in the right direction would be progress as clearly we can’t wait 3 years.

• Last week I received notification that my tax code has changed again to K2591X meaning I owe over £25k that they're expecting to be taken from my wages, but isn't. 

• I managed to speak to HMRC on Friday who confirmed, yes it's mess, but we as individuals can do nothing about it, it's down to our employer, we can't even ask them to investigate, they would only do this if we leave the company, which clearly would cause us massive issues if we started with a new employer with our current ridiculous tax codes. 

We just need to be pointed in a direction that can assist,  this is really affecting both of us as at some point HMRC will be expecting this money from us as individuals. 

Thank you in advance. 

Marcon

jacqbird said:

• My colleague and I have worked for the same company for over 10 years The company was run as a Sole Trader Company. As of 1st Jan 2023, the company became a Ltd Company (under a new name) and the Sole Trade company ceased to exist. Now the fun starts! Our boss has decided he knows what he’s doing regarding HMRC but has made a really big mess of things for us. At one point on the HMRC App was showing that my Salary for 23-24 was 1.7 Million! We spoke to our Boss, who initially said it’s the fault of HMRC, we spoke to HMRC and the error is in his court, it seems we are working for the new company twice! It’s a bit more involved but just a complete mess. Boss has spoken to HMRC who’ve said it could take 3 years to sort, but in the meantime, because of our current tax codes, we are being told by HMRC we  owe them money, myself to the tune of 17K and my colleague  6+K. Our wages are being paid at the same rate as previous so it’s not causing us a direct financial issue, but we do have these figures over our head that HMRC are trying to claim, and technically should be taken from our wages. 

•  It is causing me a financial issue because the tax code means my small pension is being taxed at a higher rate, and my colleague  is unable to release a small pension because her current tax code and money she supposedly owes would mean she’s left with net to nothing. 

•  On top of all this, we’ve found out indirectly that the Boss is trying to sell the company!

•  . The attitude of our Boss is that, he’s done what he can. I just want to find out where we can deal with this, or if there’s an organisation we can speak to who can help, just to be pointed in the right direction would be progress as clearly we can’t wait 3 years.

• Last week I received notification that my tax code has changed again to K2591X meaning I owe over £25k that they're expecting to be taken from my wages, but isn't. 

• I managed to speak to HMRC on Friday who confirmed, yes it's mess, but we as individuals can do nothing about it, it's down to our employer, we can't even ask them to investigate, they would only do this if we leave the company, which clearly would cause us massive issues if we started with a new employer with our current ridiculous tax codes. 

We just need to be pointed in a direction that can assist,  this is really affecting both of us as at some point HMRC will be expecting this money from us as individuals. 

Thank you in advance. 

See https://www.litrg.org.uk/tax-guides/employment/what-if-i-do-not-pay-enough-tax/employer-or-pension-payer-error

The suggestion that it could take 3 years to sort out is nonsense - you only have your boss's word that is the case, so why swallow it? On the other hand, you could quote that as a reason for making a formal complaint about HMRC, which might generate some action one way or another: https://www.gov.uk/complain-about-hmrc

It might also be worth having a word with ACAS's helpline: 0300 123 1100 - this won't be the first time they've come across such an issue.

jacqbird

Thank you so much for the information above, I'd already tried ACAS who would not get involved the website you have given me tho is very very useful, thank you again.