tax earnings query

thevinternet

Hi there, I have a problem with my new (ish) job and the company's accountant, so I'd really love some advice please.

I was employed in the media from April 2007 - August 2007 and earned about 2k per month. Was paying tax, it was all fine. I was then made redundant, and took the opportunity to go back to college.

Then I started work again (a different job) in November 2007 to now - it's just a little part-time weekend shop work, about £57 a week or so.

Now ever since I started this shop job, I haven't been paying tax. Not good.

I asked my boss to ask the company accountant to put me on emergency tax as I had no p45 from the last job.

I am aware of the tax threshold of about 5k earnings, but I thought this worked from April to April? ie I would have earned more than 5k this year in my first job, so I should now be getting taxed on my earnings? Please correct me if I'm wrong, I find this all very confusing.

Also now my boss is telling me that the accountant says I've been on emergency tax since day 1! Eh? How come I've been paying no tax then?!

I'm quite anxious about this because I don't want to have to pay a load back next year, so any advice anyone can give me would be wonderful.

V xxx

takoo

Hi Thevinternet

If you think you should be paying tax:

1. put an amount equivalent to the tax into an ISA every week
2. if you then have to pay in future you will not have to find a huge amount
3. call the tax office and ask them to contirm your tax position one way or other.

Takoo

fengirl_2

If you are only earning £57 pw, you are well below the weekly tax threshold of about £100 pw. You will technically be on emergency code as E code gives you your weekly tax free allowance before deducting tax.
What happened to the P45 from your old job? If you had handed this to this new employer, you would have been receiving weekly tax refunds which are due to you. You will now need to send your P45 to your tax office with details of what you have earned in this new job (you wont get a P60 as you are not liable to tax) and claim a refund.

thevinternet

fengirl wrote: »

If you are only earning £57 pw, you are well below the weekly tax threshold of about £100 pw. You will technically be on emergency code as E code gives you your weekly tax free allowance before deducting tax.
What happened to the P45 from your old job? If you had handed this to this new employer, you would have been receiving weekly tax refunds which are due to you. You will now need to send your P45 to your tax office with details of what you have earned in this new job (you wont get a P60 as you are not liable to tax) and claim a refund.

Basically I can't get a p45 from my old job, as the company has now gone kaput. I did try and get one from them several times before I left, but no joy.
Why would I be getting refunds please? Sorry but I'm well confused now.

isasmurf

fengirl wrote: »

(you wont get a P60 as you are not liable to tax)

Not true. By law, every person employed on 5th April must be given a P60.

fengirl_2

Yes, as you are now below the tax threshold, you should be getting refunds of tax each week. However, as there is no P45 you will have to ask HMRC to mkae this refund. You will need to write to HMRC and explain you dont have a P45 and hopefully they will have received your pay and tax details from the old company.
In the old days, you didnt get a P60 if you were not liable to tax, but I stand corrected by isasmurf if the rules have now changed.

thevinternet

fengirl wrote: »

Yes, as you are now below the tax threshold, you should be getting refunds of tax each week. However, as there is no P45 you will have to ask HMRC to mkae this refund. You will need to write to HMRC and explain you dont have a P45 and hopefully they will have received your pay and tax details from the old company.
In the old days, you didnt get a P60 if you were not liable to tax, but I stand corrected by isasmurf if the rules have now changed.

Ah, that's helpful, thankyou! :T
Is it likely I would get the whole amount back as a rebate at all?

thevinternet

I have just written a letter to the local tax office about this, so I'll keep you posted as to how I get on!

I'm keeping my fingers crossed for a refund....yippee!!! :j

Oh, hang on - it'll just go towards paying the tax from when I was self-employed in 2006/2007 :mad: lol

taxdoctor

Hi thevinternet,

Just a couple of quick things to add to the already wise words:

If you are still employed HMRC will not make a refund for the current tax year until it has ended, plus you will probably also need to send them your P60 from your current job as mentioned above. This is because any refund for the 07/08 will need to be made taking into account your total earnings for the tax year.

They will most likely respond to your letter asking for this extra P60 so I wouldn't worry for now.

One other thing though is to make sure you're not still expected to complete a tax return for 2007/08. Sometimes there is an overspill if you were self-employed in the previous tax year, either because they want to tidy things up or your cessation was not recorded properly on their systems.

If a return is issued (would come in the next few weeks) then it must be completed.

I'm not saying this WILL happen but it COULD, just be aware!

thevinternet

Thanks for the help taxdoctor!

I find it really odd that the tax office always need you to send forms back...don't they have the records on their system already?! It strikes me as a bit strange.

Anyway, I shall send my letter asking for some money back on the off chance, and if I have to wait for it, so be it.