The tax rebate system is terrible

semi-pro-saver

Hi there,

Ive recieved a letter today saying that i could have payed to much tax last year. So obviously i filled it in and hand delivered it this afternoon, but after thinking about it I wondered why the Inland revenue cant access that information themselves and just issue a refund.

Ive lived abroad fro a while and on the same date every year if yoyuve payed to much tax they put it straight into your account.

I wonder if the Government hope most people wont bother or at least some wont bother and then they get more money.

Or am I just being a dunce and theres a perfectly good reason its done this way. If anyone knows id appreciate hearing the reason why its done like this.

stratty

HMRC are not aware of what you have earned and paid in tax until your employer submits the Employers Annual Return (P35) and associated forms P14.

The deadline for this is May 19th and shortly after you will receive your P60 (due to the employee by May 31st).

dzug

Well a possible reason is that the Inland Revenue cannot be certain that they have complete information, so they ask you to confirm that they have before refunding you.

And 'abroad' is a really really big place. I'm sure that everywhere has their own systems which operate in slightly different ways. Some places for example deliberately overtax you so that you have to claim a refund at the end of the year. Others at least try to tax you the right amount in the first place.

LilacPixie

semi-pro-saver wrote: »

Hi there,

Ive recieved a letter today saying that i could have payed to much tax last year.......

I wonder if the Government hope most people wont bother or at least some wont bother and then they get more money.

If you seriously think this then why did they write to you in the first place???

Mikeyorks

semi-pro-saver wrote: »

Ive lived abroad fro a while and on the same date every year if yoyuve payed to much tax they put it straight into your account.

Generally only happens if you're mandated to file a Return. As mentioned earlier a number of countries operate a system deliberately designed to create overpayments .... in order to voluntarily expedite the filing of Returns.

Unless you've had a specific issue ..... it's a bit early for HMRC to be writing to you, just 12 days after the end of the tax year. So I trust the letter was from them?

semi-pro-saver

LilacPixie wrote: »

If you seriously think this then why did they write to you in the first place???

Well Im sure most people do reply when they recieve this letter but there will always be a small percentage who dont bother.

Im not saying that everyone should recieve there tax rebate instantly when the tax year finishes I just think that the tax office should know how much tax Ive over or under payed and act accordingly.

The country ive lived "abroad" in is Norway and the previous poster is correct they do slightly over tax you and guarantee a return. I fell this system works better because if for any reason you have a spell without work you will get a higher rebate.

Thanks for the previous replys

fengirl_2

HMRC cannot possibly know everything about you! Although you may have been employed at points during the year, you may also have been slef employed, in which case you would need to declare that income. If you had worked abroad for part of the year, HMRC would not have that info. Also, all employers are not as efficient at telling HMRC when someone has worked for them and so HMRC has to build a picture of your total activities for the year before they can work out your liability and repay any tax due.
Your question assumes that HMRC is all seeing and all knowing, which it most certainly is not.

seven-day-weekend

How would the tax office know for example whether in addition to your earned income, you have earnings from self employment/property lettings/interest on savings etc?

It's up to you to give them that information.