Self assesment tax return problem

Hi, my husband gave up working as a self employed sole trader during 2022. He started employment with a company in Sep 22 which went under two months later. The problem is this company have informed HMRC that he earned approx £6000 when in fact he only received approx £4500. He phoned to inform them about this a few months ago and he was told to fill in a mandatory reconsideration for our working tax credits claim (which we have yet to receive a response about). Now, while filling in his self assessment tax return they require figures for his work as an employee as well as his self employed income. Should he put in the (incorrect) figure of £6000 which HMRC has or the correct figure of what he actually received from this employer? 
Any help much appreciated

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  • Dazed_and_C0nfused
    Dazed_and_C0nfused Posts: 12,694
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    Hi, my husband gave up working as a self employed sole trader during 2022. He started employment with a company in Sep 22 which went under two months later. The problem is this company have informed HMRC that he earned approx £6000 when in fact he only received approx £4500. He phoned to inform them about this a few months ago and he was told to fill in a mandatory reconsideration for our working tax credits claim (which we have yet to receive a response about). Now, while filling in his self assessment tax return they require figures for his work as an employee as well as his self employed income. Should he put in the (incorrect) figure of £6000 which HMRC has or the correct figure of what he actually received from this employer? 
    Any help much appreciated
    Self Assessment returns don't ask for what was "received".

    Do you mean the taxable pay was £4,500 not £6,000?

  • JGB1955
    JGB1955 Posts: 3,432
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    edited 18 January at 5:39PM
    Was the £6K taxed at 20%? That would make roughly £4,500 after deductions for tax and NI.  Has he got his final pay slip from the company?  That would show tax and NI deducted 'to date'.
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  • The employer has claimed to HMRC the taxable pay was £6000. He only received payslips (and pay) totalling £4500 taxable pay. He did not receive a p45 btw. 

    The self assessment tax return has this section (copied and pasted)
    "Pay from [Employer name] - total from your P45 or P60. Enter the amount before tax taken off:"
  • JGB1955 said:
    Was the £6K taxed at 20%? That would make roughly £4,500 after deductions for tax and NI.  Has he got his final pay slip from the company?  That would show tax and NI deducted 'to date'.
    Hi no it was not taxed. There was no final pay slip. It turned out the company was taken over by an asset stripper so he wasn't concerned with doing things correctly. But this is more about keeping things right with HMRC. The figure they have been given by the employer is wrong. Should he put in that figure anyway as that is what they have or should he put in the correct one? 
  • Hi, my husband gave up working as a self employed sole trader during 2022. He started employment with a company in Sep 22 which went under two months later. The problem is this company have informed HMRC that he earned approx £6000 when in fact he only received approx £4500. He phoned to inform them about this a few months ago and he was told to fill in a mandatory reconsideration for our working tax credits claim (which we have yet to receive a response about). Now, while filling in his self assessment tax return they require figures for his work as an employee as well as his self employed income. Should he put in the (incorrect) figure of £6000 which HMRC has or the correct figure of what he actually received from this employer? 
    Any help much appreciated
    Self Assessment returns don't ask for what was "received".

    Do you mean the taxable pay was £4,500 not £6,000?

    The employer has claimed to HMRC the taxable pay was £6000. He only received payslips (and pay) totalling £4500 taxable pay. He did not receive a p45 or p60 btw. 

    The self assessment tax return has this section (copied and pasted)
    "Pay from [Employer name] - total from your P45 or P60. Enter the amount before tax taken off:"
  • eskbanker
    eskbanker Posts: 29,799
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    JGB1955 said:
    Was the £6K taxed at 20%? That would make roughly £4,500 after deductions for tax and NI.  Has he got his final pay slip from the company?  That would show tax and NI deducted 'to date'.
    Hi no it was not taxed. There was no final pay slip. It turned out the company was taken over by an asset stripper so he wasn't concerned with doing things correctly. But this is more about keeping things right with HMRC. The figure they have been given by the employer is wrong. Should he put in that figure anyway as that is what they have or should he put in the correct one? 
    Why wasn't any tax deducted, did he have a PAYE tax code?

    It seems a strange scenario but the discrepancy between employer and employee records will need to come out eventually, so I can't think of any reason to falsify figures when self-assessing, and he should use the figures he believes to be correct, i.e. the ones he was given on payslips, which correspond to the payments....
  • eskbanker said:
    JGB1955 said:
    Was the £6K taxed at 20%? That would make roughly £4,500 after deductions for tax and NI.  Has he got his final pay slip from the company?  That would show tax and NI deducted 'to date'.
    Hi no it was not taxed. There was no final pay slip. It turned out the company was taken over by an asset stripper so he wasn't concerned with doing things correctly. But this is more about keeping things right with HMRC. The figure they have been given by the employer is wrong. Should he put in that figure anyway as that is what they have or should he put in the correct one? 
    Why wasn't any tax deducted, did he have a PAYE tax code?

    It seems a strange scenario but the discrepancy between employer and employee records will need to come out eventually, so I can't think of any reason to falsify figures when self-assessing, and he should use the figures he believes to be correct, i.e. the ones he was given on payslips, which correspond to the payments....
    Hi, there was no tax as he didn't earn enough that year. It is strange and even though he has informed them their figure is wrong they didn't suggest any way of correcting it. No suggestion of falsifying figures btw! It's more about which figure to use. His figure is correct and he has proof. 
  • eskbanker
    eskbanker Posts: 29,799
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    But if he started employment in September 2022 at £2+K/month, not knowing that it would finish before the end of the tax year, income tax should have been deducted via PAYE every month, rather than only in months after he'd exceeded his personal allowance.

    However, bottom line remains that he should honestly declare his actual taxable income now, and then sort out any anomalies once HMRC have decided if they wish to challenge it....
  • Dazed_and_C0nfused
    Dazed_and_C0nfused Posts: 12,694
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    eskbanker said:
    But if he started employment in September 2022 at £2+K/month, not knowing that it would finish before the end of the tax year, income tax should have been deducted via PAYE every month, rather than only in months after he'd exceeded his personal allowance.

    However, bottom line remains that he should honestly declare his actual taxable income now, and then sort out any anomalies once HMRC have decided if they wish to challenge it....
    They could have signed statement A on a new starter declaration though and got a cumulative code.
  • sheramber
    sheramber Posts: 18,608
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    What exactly  is  shown  on his payslips?
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