Tax code notice query

grn99

Hoping this is the correct place to post…

I've POA for my elderly father (who also now has dementia). I've just picked up his tax code notice paperwork for the coming tax year 26/7 and a few aspects I don't fully understand.

1. His state pension on the notice is shown as £14,028, yet on his online HMRC account it's actually 13,297.44". The payments into his bank paid over 13 weeks equal £13,269.48 So is this Sp on the coding notice in error?
2. On the notice, the combination of his personal allowance plus his gift aiding contrbibutions adds up to £12,949 from this is subtracted the SP figure of £14,028 and a futher £1,079 is added to his former employer's DB pension, and code K106 assigned to recover tax apparently.

Do these figures make sense? My plan was to call HMRC tomorrow and query, but thought any advance insight from this forum would be most helpful. I obviously gannot get any answers or clarity from my father on any bckground to these matters. Many thanks.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6657480/tax-code-notice-query

1. Are you comparing a tax code for the next tax year with the State Pension for the current tax year? Also, no one can have State Pension paid monthly. It's virtually always weekly or 4 weekly.
2. It can't possibly "make sense" without knowing the full details. How many pensions does he have? What is the estimated pension HMRC are using for each one? Is that accurate? Does he have any other taxable income? Including any that is taxed at 0%? Is the Gift Aid still relevant?

grn99

Yes, SP is 4 weekly. Only one other pension from his one employer. I clearly need to work through the detail when I have it and call HMRC tomorrow. Many thanks.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81904562#Comment_81904562

He is likely to have a letter from DWP confirming the weekly rate for his State Pension from April 2026.

And the entry for Gift Aid isn't how much HMRC thinks he's donating, it's a tax code adjustment to give any tax relief they think is due over and above the basic rate. It might take a review to check the correct Gift Aid situation and then you could tell HMRC of an updated figure (as in the net amount he donates) to use from April 2026 so they can work out any updated tax code adjustment needed.

IOWJJBTM2025

full basic State pension for 25-26 was £230.25 per week or £11,973 per year.

The tax free allowance is £12,570 and so is above the basic state pension.

If your Dad has other pensions they will be taxed at source.

Both the State Pension and employers pension are taxable.

It sounds like your Dad may have qualified for additional benefits?

grn99

https://forums.moneysavingexpert.com/discussion/comment/81904583#Comment_81904583

Thanks. The only other benefit is an Attendance allowance, but that's not taxable.

p00hsticks

As his (taxable but not taxed at source) state pension is more than his annual allowance then I believe it's correct that his private pension has a K code.

This way the amount of state pension over the allowance will effectively be added to his private pension amount by the pension provider when calculating the tax to be deducted to ensure that he doesn't underpay.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81904583#Comment_81904583

Standard basic State Pension for 2025/26 was only £176.45, you are quoting the new State Pension value, which is almost certainly not relevant to the op's dad.

Some people on the old basic State Pension can be getting well over £400/week.

The op referred to a K code, not SK (where the intermediate rate band would be a factor) so chances are his dad is a higher rate payer. So there may be additional benefits available but less likely than for some people.

grn99

https://forums.moneysavingexpert.com/discussion/comment/81904602#Comment_81904602

Many thanks, that makes sense.

squirrelpie

Just to note that another reason for a K tax code can be if he has untaxed income from savings (e.g. in a bank savings account). But none has been mentioned so perhaps not in this case.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81904564#Comment_81904564

My letter confirming the new rate from April only arrived a few days ago, so maybe some have still to arrive.