Tax Advice please!

Pilchard

Hi there

I submitted my tax return for last year in December as I'm registered self employed for mystery shopping. I earned £112 last year but when I did the return it said I owed £941 tax :eek: I went to the tax office with all my documents from previous jobs etc and was told I didn't owe any tax. When I put the same figures he wrote for me in the assessment, however, it still said I owed £941. To cut a long story short I finally found out from another tax officer that it's because of Student Loan repayments a company took out of my wage for 18 months. I took out one year of a loan in 2001-2002 and entered the repayment system in 2004. Only one company took them, however. I finally managed to speak to someone at the Student Loan company the other day who said that this is right and that even if I pay voluntary repymants the tax office won't recognise it and I'll still be taxed on what my employer takes out of my wages (hopefully that's sorted again now).

Today I received notification from the tax office that my allowance has gone from £5400 (or something) down to £720 to take into account the amount I owe. I've got several questions here:

How can I lose over £4000 in allowances for £941 I owe?
Will I have to pay horrendous amounts of tax until the loan is paid back?
Is it worth my time and money seeing an accountant?
If so, does anyone know a decent (and reasonable) one in the Leeds/Wakefield area?

Many thanks for reading this xx

terryw

The £4000 is allowances .....so if this is deducted in your tax code you will pay extra 4000 times the rate of tax you pay, say, 25 per cent which equals £1000. ( I have just done rough figures to illustrate the point.) Best you can do I think is ask HMRC to take this tax owing off over 2 or 3 years.
This looks ok but check all the figures yourself. Accountants are expensive and they will need all the paperwork before they can help. I am sure that you can do this yourself.