Non coded income

angryoldgit

Hi, can anyone explain what non coded income is.
When I look on the HMRC web site I see they have me down for earning £16,641.00 as non coded income. I don't understand where this figure comes from. All my earning are from my state and other pensions and these are all listed correctly.
Is this why my personal allowance is only £960.00?
I did work part time for a few weeks in the summer, but paid 20% income tax on those earnings. 
How can I get this corrected?
Thanks in advanced.

Ayr_Rage

Once receiving the SP, which is not taxed, your tax code will be reduced by the amount of the SP and that code applied to other income.

How is that code being applied elsewhere, for example to a company pension?

How much interest do you receive?

angryoldgit

Any interest I receive is well below £1k per year. I'm paying about 50% tax on one of my smaller pensions which I don't think is correct.

Ayr_Rage

To get a definitive answer here you'll have to provide a lot more information regarding all of your income and how each element is taxed and with what code, then one of the experts (not me) will advise further.

A simpler way to do it is to add up all of your gross income from the state and other pensions (not savings interest or dividends) then put that figure into an online tax calculator and let it calculate your net income assuming the standard tax code of 1257L, remember to say you don't pay NI.

Once you have that net figure, add up up all the individual net monthly figures you receive and see if the numbers match.

DRS1

Are you saying HMRC have just made up an income figure for you?  You say they have listed your earnings (SP and pension) correctly but do you have any other sources of income like dividends or rent?

Do you do a self assessment tax return?

Dazed_and_C0nfused

angryoldgit said:

Hi, can anyone explain what non coded income is.
When I look on the HMRC web site I see they have me down for earning £16,641.00 as non coded income. I don't understand where this figure comes from. All my earning are from my state and other pensions and these are all listed correctly.
Is this why my personal allowance is only £960.00?
I did work part time for a few weeks in the summer, but paid 20% income tax on those earnings. 
How can I get this corrected?
Thanks in advanced.

Have you ever filed a Self Assessment return?

It could impact your Personal Allowance.  But only if it meant your adjusted net income (including the non coded income amount) tipped over £100,000.

Do you actually have any reason to think your tax code(s) are wrong?  If so could you explain why and provide the breakdown of your codes.  Along with the estimated amounts you think you get for the tax year you are referring to.

NB.  For State Pension just the weekly amount will be enough info.

angryoldgit

Yes I did submit a self assessment return,. My total income is £21K. I've no idea where this uncoded income comes from. I certainly don't receive it. Does this mean anyone on a state pension gets their personal allowance reduced?
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[Deleted User]

angryoldgit said:

Yes I did submit a self assessment return,. My total income is £21K. I've no idea where this uncoded income comes from. I certainly don't receive it. Does this mean anyone on a state pension gets their personal allowance reduced?
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Yes - that is the only mechanism by which the additional tax can be deducted. 

Let’s say you have earnings of £12000 from an occupational pension or employment and no other income - no tax due.

You now receive £9000 of state pension. Your income is now £21000 and tax of £1686 is payable. This cannot be deducted from your state pension. Your tax code at the occupational pension or employment is adjusted to collect the total tax due. This system has existed for many decades.

sheramber

is £16,641 the amount of your state pension?

Dazed_and_C0nfused

sheramber said:

is £16,641 the amount of your state pension?

It will relate to one or more entries on a Self Assessment return the op has completed.

sheramber

Dazed_and_C0nfused said:

sheramber said:

is £16,641 the amount of your state pension?

It will relate to one or more entries on a Self Assessment return the op has completed.

He does not mention a Self Assessment tax return.