Wrong tax taken from wages

Penguin_

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

purpleparrotuk

Penguin_ said:

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

It’s an electric car. No emmisions. It’s fine we know what’s happened. The tax office have £0 payments in the salary sacrifice section so it’s wrong. 

Penguin_

Have HMRC confirmed that?

purpleparrotuk

Penguin_ said:

Have HMRC confirmed that?

We are on hold but you can see it’s wrong. We are making a £1100 payment before tax for the car every month. They have 0 contributions on the website. 

Dazed_and_C0nfused

purpleparrotuk said:

Penguin_ said:

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

It’s an electric car. No emmisions. It’s fine we know what’s happened. The tax office have £0 payments in the salary sacrifice section so it’s wrong. 

Are you sure, salary sacrifice aspect will reduce the income he pays tax on, not the benefit on kind.

I suspect the real issue here is the benefit value in his tax code is massively overstated for some reason.

purpleparrotuk

Dazed_and_C0nfused said:

purpleparrotuk said:

Penguin_ said:

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

It’s an electric car. No emmisions. It’s fine we know what’s happened. The tax office have £0 payments in the salary sacrifice section so it’s wrong. 

Are you sure, salary sacrifice aspect will reduce the income he pays tax on, not the benefit on kind.

I suspect the real issue here is the benefit value in his tax code is massively overstated for some reason.

Yes I’m sure. We pay £1100 before tax for the car. The tax office have £0 payments in the portal. They don’t know we are making this payment. We can amend it online but want to speak with someone so still on hold. 

Penguin_

That is the basis for COMPANY CARS not salary sacrifice.

Salary Sacrifice payments reduce your taxable income so you pay less tax & NI.

I would check that they have it listed as an electric car with 0 CO2 emissions.

Penguin_

Dazed_and_C0nfused said:

purpleparrotuk said:

Penguin_ said:

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

It’s an electric car. No emmisions. It’s fine we know what’s happened. The tax office have £0 payments in the salary sacrifice section so it’s wrong. 

Are you sure, salary sacrifice aspect will reduce the income he pays tax on, not the benefit on kind.

I suspect the real issue here is the benefit value in his tax code is massively overstated for some reason.

I agree - I think they have the wrong model listed or they haven't ticked the electric only as fuel type in the payroll softeware.

purpleparrotuk

Penguin_ said:

Dazed_and_C0nfused said:

purpleparrotuk said:

Penguin_ said:

If it's the model I think it is, it has 153 g/km CO2 emissions which means he is subject to a whopping 35% BIK Tax on the P11d value of the car. 

It’s an electric car. No emmisions. It’s fine we know what’s happened. The tax office have £0 payments in the salary sacrifice section so it’s wrong. 

Are you sure, salary sacrifice aspect will reduce the income he pays tax on, not the benefit on kind.

I suspect the real issue here is the benefit value in his tax code is massively overstated for some reason.

I agree - I think they have the wrong model listed or they haven't ticked the electric only as fuel type in the payroll softeware.

His work haven’t notified them we are on salary sacrifice. Thats the problem.  The payroll department are ok holiday and we’ve had the car 2 months. Looks like we will just have to be £300 worse off this month until it’s sorted. 

Penguin_

How do HMRC know that your husband has a car then?

There isn't a "salary sacrifice" option in payroll software when you report a car. You tick a box to say it's being payrolled which then means you pay the BIK tax in real time & it wouldn't be on a P11d.