Tax Code Change Question

Bentley_Boys_UK

Can anyone help answer this question.

My tax code changed this month on my 31/1/08 payslip. It went up from that on my 20/12/07. My gross monthly salary remains the same between the months but my tax deduction amount for January has increased by 8%.

I thought if the tax coding changed (472 to 518L) I should be better off. Or have I misunderstood.

Thanks.

lolarentt

An L tax code is your tax free allowance for that tax year divided by 10.
With 472L you had a tax free allowance of £4720, which has now increased to £5180 - you'll get an extra £460 you wont be taxed on this year.

(I can't explain your additional deductions as I don't have the background and breakdown)

CLAPTON

if you want to post the following then it should be posible to work out whats happened

for Dec
your exact tax code (including any letters or words after the number)
your gross to date
your tax to date
earnings this period
tax this period
month or week number

and the same again for January

Bentley_Boys_UK

Dec 07
Tax code: 0472L
Gross to Date: 36681.67
Tax to Date: 7664.70
Earnings period: 4357.75
Tax paid period: 906.31
Month: Dec 07. Tax period 9

Jan 08
Tax code: 0518L
Gross to Date: 41514.79
Tax to Date: 8643.39
Earnings period: 4401.14 (there's 43.39 of business miles in this)
Tax paid period: 978.69
Month: Jan 08. Tax period 10

Many thanks.

chrisbur

Your gross to date for Dec is 36681.67 and your gross for Jan is 4401.14 which would give a gross to date for Jan of 41082.81. But you quote 41514.79.

Your tax to date figure seems to be to low.

Do you have any pension being deducted from your salary if so is it being taken out of your salary before tax is deducted. If this is the case your payslip should have two gross figures a gross to date and a taxable gross to date.

chrisbur

The extra 431.98 could have come from the P6 that changed your code, have you had this amount from another employer or as taxable benefit without it being taxed since last April?

Bentley_Boys_UK

Many thanks for comments so far.

Yes there is pension that comes off (approx £250 per month). The taxable pay to date is 34888.37 (Dec) and 39465 (Jan). I changed jobs on the 1/6/07 and there was some back pay from my previous employer paid in July of 354.66 gross / 276 net.

CLAPTON

well a taxable to date of 3488.37 with a tax code of 472L gives a tax to date of 7664 (my calculation) approx which agrees with your figure of 7664.70 (dec)

a taxable to date of 39465 with a tax code of 518L gives a tax to date of 8643 (my calculation) which agrees with your figure of 8643

so that means you overpaid tax in period to November 07 for what ever reason so you paid the difference in Dec salary giving a lower figure for the tax in Dec.

so check or post all the figures for November

chrisbur

I have checked these taxable gross figures and the tax deducted now fits them.

In your January salary you have paid tax on the gross that was added. It does not seem likely that the 354.66 had anything to do with it. Apart from being the wrong amount your previous employer took some tax off this and no tax has been added to your figures only gross. Also they did not have to tell the tax office about this extra payment it only needed to be included in the end of year figures that the tax office will get after April this year. You will proberbly owe a bit of tax on this as tax was deducted at 22% and will proberbly be due at 40%.

First I think you need to check with your payroll dept. to confirm that a P6 was recieved and that it had previous gross of about 431.98 on it and no previous tax, and that it was for you. The P6 should show your name and NI number. If that is all in order then you need to contact the tax office, your payroll dept. will advise which one, to ask where these earnings came from.

Were you expecting an increase in your tax code, the 472L code would be a code where you were getting some sort of benefit from your employer for example BUPA membership low interest rate loan etc. or tax owing for a previous year? A change of code is usualy accompanied by a notice advising of this and explaining it, did you get one of these?