It's Time To Check Your Tax Codes

molerat

It seems that random tax code change season has come round again, a bit late this year, so probably best for everyone to have a quick look.  I check mine at least once a week during October / November and today it paid off.

Every April I put £2880 into my SIPP

Every April I update that income stream to show £2700 taxable income

Every June I withdraw around £2714 taxable income

Every October HMRC decide that income stream is around £8140 and change my tax code to recoup the "underpaid tax" and send me a letter

Every October I reset that income to £2715 and HMRC change my tax code back and send me a letter.

Every November my pension provider that my allowance is set against sends me a letter that they have implemented the new (reversal) tax code they have been issued - the same code they have been using all year.

Complete waste of time and money all round 

Isthisforreal99

Sign up for a Personal Tax Account and everything will be digital.

molerat

Isthisforreal99 said:

Sign up for a Personal Tax Account and everything will be digital.

How do you think I check my tax code ?

I would rather not rely on the inept HMRC to inform me (or maybe forget to inform me) of what they have done and do it the old fashioned way of checking for myself.

Isthisforreal99

molerat said:

Isthisforreal99 said:

Sign up for a Personal Tax Account and everything will be digital.

How do you think I check my tax code ?

I would rather not rely on the inept HMRC to inform me (or maybe forget to inform me) of what they have done and do it the old fashioned way of checking for myself.

 Well can only speak for myself but I get an alert via the app and an e-mail that I have a change of tax code.

Also saying 'send me a letter' did not imply using your PTA.

Albermarle

Isthisforreal99 said:

molerat said:

Isthisforreal99 said:

Sign up for a Personal Tax Account and everything will be digital.

How do you think I check my tax code ?

I would rather not rely on the inept HMRC to inform me (or maybe forget to inform me) of what they have done and do it the old fashioned way of checking for myself.

 Well can only speak for myself but I get an alert via the app and an e-mail that I have a change of tax code.

Also saying 'send me a letter' did not imply using your PTA.

I sometimes get an e mail and sometimes I don't, when there is a tax code change. No idea why.

molerat

This morning the tax code is back to where it was with a date of 27th Nov.  There is no sign of the interim code change, both old and new codes are the same, likely as it was all done on the same day.

WindfallWendy

Does this coincide with when HMRC release views on the interest reported by banks?

I only ask as my husband had a letter from HMRC saying they want him to pay tax on savings interest over £500 from 24/25. Fair enough. But we can't work out how they have totted up £700 in interest.

One issue he did have was he had a small savings account mature which he paid into his S&S ISA. We then had some interitence and he popped some into a separate cash isa, allowing for ongoing monthly payments into S&S ISA. 
Except he forgot about the small savings maturity which he'd added to S&S. So at some point in 24/25 he paid more than £20k across two ISAs (one cash, one S&S).

Does anyone know how they might calculate interest in such circumstances?? Do Personal Tax Accounts break down interest across different accounts?

And back on the topic of tax codes, will they change it based on a potentially new assumption of how much interest he earns on savings?

RG2015

@WindfallWendy

The best way to get a breakdown of the £700 interest is to request a BBSI statement from HMRC (stands for bank and building society interest).

Phoning is a pain but if you do, call just before 08:00 on a weekday just as the lines are opening. Alternatively you can send in your request by post.