Tax advice needed.

MC0412 · 5 January 2018 at 4:08PM

Hello All

I've been working at a pub for the past 5 years since i was at college and until recently I've had no really course for concern. However, i started a full time job approximately two years ago but kept the pub on the side as a bit of extra income. I've now received a tax bill of £500 for my earnings from the pub over 16/17, is this right? or should the pub have been making the deductions from the pay for me? I've never received a pay slip from them nor a end of year P60? I'm a tad confused about the whole situation if im honest so any advice would be really helpful!

Thankyou

ACG · 5 January 2018 at 4:16PM

Im going to struggle to explain what I think the problem is in writing but I will give it a try...

You get a tax free allowance of around £11k every year. I am guessing your income at the pub was less than £11k.

So when you started the new job, you paid tax based on that income alone, the tax man has eventually realised you have had 2 jobs and effectively not paid tax on the first £11k of the new job (which is fine) and also not paid tax on the first £11k of the old job (or however much you did earn at the old job).

We used to own a pub and there was a girl who worked for us that had 3 jobs, this cropped up with her.

MC0412 · 5 January 2018 at 4:34PM

I get what you're saying ACG and confirms what I was thinking, as far as the pub were concerned i wasn't earning over the £11K threshold and therefore they didn't have to deduct tax??

In regards to payslips and the P60 surely i should have received these during my employment there?

agrinnall · 5 January 2018 at 5:24PM

I think it would help if you tell us how much you were earning (weekly/monthly, however you were paid) in the pub job, so that we can decide whether they should have been paying employer's NI and deducting employee's NI from your gross pay, which would have been reflected in payslips and P60.

MC0412 · 5 January 2018 at 5:26PM

Agrinnall - my earnings from the pub for that tax year where £3500 or there abouts, added to my other earns took me to £13,500 for that year, £2500 over the threshold.

ACG · 5 January 2018 at 7:22PM

Both jobs will have been down as your first/main job.
When you started at the pub, it would have been correct. When you started the new job it would have been correct. HMRC have about 10 different computer systems and so it does sometimes take time for things to catch up - I remember getting 2 letters for them a day apart, one was an invoice and the other a cheque for an overpayment.

The only way you will know if it is correct is to check what you earnt each tax year against the tax tables for that year, but chances are it will be right.

The pub should have given you P60s and payslips yes.

agrinnall · 5 January 2018 at 9:55PM

MC0412 wrote: »

Agrinnall - my earnings from the pub for that tax year where £3500 or there abouts, added to my other earns took me to £13,500 for that year, £2500 over the threshold.

Please answer the question that I asked, your total earnings from the pub job are not what we need to know.

Dazed_and_confused · 6 January 2018 at 11:09AM

No but for 2016:17 if the total income was £13,500 and the tax owed is £500 then it seems reasonably clear that no tax was deducted at either job.

13500 - 11000 = 2500 x 20% = £500

Op may be best advised to ensure he gets the correct tax codes sorted now to minimise the tax bill that's no doubt building up for the current year.

jobbingmusician · 6 January 2018 at 11:24PM

If you contact HMRC you may well be able to have this tax reclaimed by an adjustment in your tax code for the new tax year. I do understand that if you're a student, £500 sounds like a nightmare. Just over £40 a month is a lot more palatable though, no?

vegasvisitor · 7 January 2018 at 11:59AM

MC0412 wrote: »

Agrinnall - my earnings from the pub for that tax year where £3500 or there abouts, added to my other earns took me to £13,500 for that year, £2500 over the threshold.

So, your main job was £10k, and not taxable. Then you had £3500 earnings. As someone else said, £13,500 less £11k personal allowance - £2500. 20% of this is your £500.

You must have been aware that the pub were paying you without deducting tax though. You are obliged to tell them you have other employment for them to be able to deduct the tax. Otherwise they continued to assume they're your main employer.

chrisbur · 7 January 2018 at 1:27PM

What should have happened is that both employers on commencement should have asked the following and the OP should have picked A B C or non of them.

"A This is my first job since last 6 April and I have not been receiving taxable Jobseeker’s
Allowance, Employment and Support Allowance, taxable Incapacity Benefit,
State or Occupational Pension.
B This is now my only job but since last 6 April I have had another job, or received taxable
Jobseeker’s Allowance, Employment and Support Allowance or taxable Incapacity Benefit.
I do not receive a State or Occupational Pension.
C As well as my new job, I have another job or receive a State or Occupational Pension."

When starting the second job option C should have been selected and tax would have been deducted at basic rate. The OP could have then arranged a better split of the tax allowance with HMRC.

Tax advice needed.

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