Starting Self Assessment - How is last year's PAYE settled?

Shylock_249

Dazed_and_C0nfused said:

You also need to include details of any tax underpayment which was included in the tax code of the tax year the Self Assessment returns relates to.

So say for example you owed, in total, £500 at 5 April 2023 and £200 of this was being collected via your 2023-24 tax code you would only need to include the £200 on your 2023-24 Self Assessment return.

NB.  There is a specific box for this.

Many thanks.

I'm confused, sorry really confused and starting to panic a bit.

On 6 Nov 2022 HMRC sent me a P800 saying I owed them £172.40 for the year 2021 - 22. I don't seem to have received a P800 since. Probably because interest rates dropped considerably and their estimates exceeded what I'd paid? Just a thought.

On the same date they issued a "Your tax code notice" (is this a P2 ?) for 6 Apr 22 - 5 Apr 23 and at Note 4 (tax you owe (earlier year)) is shows £862 (862 x 20% = 172.40, got that) saying that they would be collecting that in equal instalments to ensure I pay the £172 by 5 Apr 23. I get that bit (I think).

From your kind explanation, if I owed £500 why would only £200 be collected the next year?

I've managed to download, I can't remember where, from a PDF SA100 2023 and I've been unable so see where such figures in your explanation would be placed.

Additionally, unless I'm breaking any laws, I'd prefer to start SA at the beginning of a FY and NOT part way through, if it were at the beginning of a FY (take my figures above) the £172.40 would have been paid off in full, would it NOT?

Thanks again!

[Deleted User]

Goodness me - you really are confusing yourself. 

You have downloaded a paper return - underpayments from a previous year do not form part of that as, by virtue of the fact that you are completing a paper return, you are asking HMRC to do the calculation. 

Your last paragraph makes no sense at all. It doesn’t matter when you ‘start SA’ - the tax return for 2023/24 will be for the whole of that tax year. The £172.40 will have been paid off and will be reflected in the tax that you paid under PAYE.

On the £200 collected out of £500 point - this could be because HMRC had taken steps part way through the tax year to collect some of the £500. As this has the prospect of confusing you further it is probably best that you ignore this point.

Dazed_and_C0nfused

Shylock_249 said:

Dazed_and_C0nfused said:

You also need to include details of any tax underpayment which was included in the tax code of the tax year the Self Assessment returns relates to.

So say for example you owed, in total, £500 at 5 April 2023 and £200 of this was being collected via your 2023-24 tax code you would only need to include the £200 on your 2023-24 Self Assessment return.

NB.  There is a specific box for this.

Many thanks.

I'm confused, sorry really confused and starting to panic a bit.

On 6 Nov 2022 HMRC sent me a P800 saying I owed them £172.40 for the year 2021 - 22. I don't seem to have received a P800 since. Probably because interest rates dropped considerably and their estimates exceeded what I'd paid? Just a thought.

On the same date they issued a "Your tax code notice" (is this a P2 ?) for 6 Apr 22 - 5 Apr 23 and at Note 4 (tax you owe (earlier year)) is shows £862 (862 x 20% = 172.40, got that) saying that they would be collecting that in equal instalments to ensure I pay the £172 by 5 Apr 23. I get that bit (I think).

From your kind explanation, if I owed £500 why would only £200 be collected the next year?

I've managed to download, I can't remember where, from a PDF SA100 2023 and I've been unable so see where such figures in your explanation would be placed.

Additionally, unless I'm breaking any laws, I'd prefer to start SA at the beginning of a FY and NOT part way through, if it were at the beginning of a FY (take my figures above) the £172.40 would have been paid off in full, would it NOT?

Thanks again!

A P2 is indeed a tax code notice.  If the £172.40 was included in your 2022-23 tax code you wouldn't need to included that on a Self Assessment return for 2023-24 (your first year in Self Assessment?).

It's a little unusual for the tax owed to be collected in the next tax year, not impossible but less common.

A more typical scenario would be like this,
During 2022-23 HMRC establish that you owe £200 for 2021-22 and this will be included in 2023-24 tax code

During 2023-24 HMRC establish that the cumulative amount you owe at at the end of the 2022-23 tax year is £500.  They are already trying to collect £200 of this by an adjustment to your 2023-24 tax code and will collect the remainder by an adjustment to the 2024-25 tax code.

Other than in the tax year someone dies a Self Assessment return is always for a complete tax year.

You might find this HMRC video worth a watch.

https://youtu.be/XHxmEL1IDck?si=MtLt524g6tJOtVBD

Shylock_249

[Deleted User] said:

Goodness me - you really are confusing yourself. 

You have downloaded a paper return - underpayments from a previous year do not form part of that as, by virtue of the fact that you are completing a paper return, you are asking HMRC to do the calculation. 

Your last paragraph makes no sense at all. It doesn’t matter when you ‘start SA’ - the tax return for 2023/24 will be for the whole of that tax year. The £172.40 will have been paid off and will be reflected in the tax that you paid under PAYE.

On the £200 collected out of £500 point - this could be because HMRC had taken steps part way through the tax year to collect some of the £500. As this has the prospect of confusing you further it is probably best that you ignore this point.

Thank you!

Shylock_249

Dazed_and_C0nfused said:

Shylock_249 said:

Dazed_and_C0nfused said:

You also need to include details of any tax underpayment which was included in the tax code of the tax year the Self Assessment returns relates to.

So say for example you owed, in total, £500 at 5 April 2023 and £200 of this was being collected via your 2023-24 tax code you would only need to include the £200 on your 2023-24 Self Assessment return.

NB.  There is a specific box for this.

Many thanks.

I'm confused, sorry really confused and starting to panic a bit.

On 6 Nov 2022 HMRC sent me a P800 saying I owed them £172.40 for the year 2021 - 22. I don't seem to have received a P800 since. Probably because interest rates dropped considerably and their estimates exceeded what I'd paid? Just a thought.

On the same date they issued a "Your tax code notice" (is this a P2 ?) for 6 Apr 22 - 5 Apr 23 and at Note 4 (tax you owe (earlier year)) is shows £862 (862 x 20% = 172.40, got that) saying that they would be collecting that in equal instalments to ensure I pay the £172 by 5 Apr 23. I get that bit (I think).

From your kind explanation, if I owed £500 why would only £200 be collected the next year?

I've managed to download, I can't remember where, from a PDF SA100 2023 and I've been unable so see where such figures in your explanation would be placed.

Additionally, unless I'm breaking any laws, I'd prefer to start SA at the beginning of a FY and NOT part way through, if it were at the beginning of a FY (take my figures above) the £172.40 would have been paid off in full, would it NOT?

Thanks again!

A P2 is indeed a tax code notice.  If the £172.40 was included in your 2022-23 tax code you wouldn't need to included that on a Self Assessment return for 2023-24 (your first year in Self Assessment?).

It's a little unusual for the tax owed to be collected in the next tax year, not impossible but less common.

A more typical scenario would be like this,
During 2022-23 HMRC establish that you owe £200 for 2021-22 and this will be included in 2023-24 tax code

During 2023-24 HMRC establish that the cumulative amount you owe at at the end of the 2022-23 tax year is £500.  They are already trying to collect £200 of this by an adjustment to your 2023-24 tax code and will collect the remainder by an adjustment to the 2024-25 tax code.

Other than in the tax year someone dies a Self Assessment return is always for a complete tax year.

You might find this HMRC video worth a watch.

https://youtu.be/XHxmEL1IDck?si=MtLt524g6tJOtVBD

Thank you!