PAYE Query

Ms_Chocaholic

Just amended tax code for income as left employemnt, this will result in me overpaying tax on first month's income, HMRC have said this but I don't understand it, can someone epxlain please.

when the tax code is used for the 1st time it will repay any over paid tax through that pension payment then you will receive the normal allowance from that tax code each month

chrisbur

I assume from this that your tax code has been increased, is on a cumulative basis and your next payment will be in month 2 ie  6/5 to 5/6.
Not enough details to be specific but you will have paid a bit extra tax in month 1 In month 2 the tax you pay will be adjusted to give back the extra tax this might just be a reduction in the tax deducted or if more is owed back there would be a rebate.  From then on the normal tax for that code would be deducted. If the reduction in tax turns out to result in no tax being due then all tax paid would be refunded and no tax deducted going forward.

If you want to give details of tax codes involved along with payments being made a more detailed answer can be given.

Albermarle

Ms_Chocaholic said:

Just amended tax code for income as left employemnt, this will result in me overpaying tax on first month's income, HMRC have said this but I don't understand it, can someone epxlain please.

when the tax code is used for the 1st time it will repay any over paid tax through that pension payment then you will receive the normal allowance from that tax code each month

Remember that a tax code is just a way for HMRC to TRY and take the right amount of tax each month. If for some reason it does not work correctly, then the tax being paid can be adjusted in the following months and/or corrected when the tax year ends.