Letter from HMRC 4 years post bankruptcy

If you had a nil TC and were paying your 'surplus' to moonbeaver - you shouldn't have a tax bill for that period at all. You need to speak to HMRC and double check they have all the right info.

The tax due during the tax year of your B.R is paid to the O.R.
In April you go back to P.A.Y.E. as normal.
You do not have to pay it twice.

wharty wrote: »

It was my understanding that the Nil tax code means you still owe the tax on your earnings while bankrupt. The tax code means you have a surplus to pay your creditors. Once you get your normal code you will then still have to pay the tax that you owe to HMRC but a year later? Hope I’m wrong.

No! Not at all. HMRC simply become creditors same as everyone else like the bank and whoever else you owe money to. The OR collects the tax money you don't pay due to the NT code - via an agent (like moonbeaver or Clarke Willmot). This continues until either the start of the next new tax year in April or if you change jobs - which ever comes first. From the start of the new tax year you pay your tax on your earning as normal - there is no 'back tax' to pay.

Suzanne83 wrote: »

So you think this is an error and I shouldn’t have to pay it??


Thanks,

It does sound like an error - I think you need to check with HMRC that they understand you were BR during that 2013/14 tax year and you were on an NT code and that moonbeaver were collecting the 'surplus' for the OR. You should not have been liable for tax until April 2014 onwards unless you changed jobs during that 13/14 year. And if oyou did change jobs, you should have had a normal tax code and paid normal tax from the start of the new job regardless of whether it was during the 13/14 tax year.

It might be helpful to get your BR paperwork together ready to send a copy of the judgement as proof of your NT liability. Any tax arears prior to the 2013/14 year would have fallen into the BR anyway. Your tax liability will be from April 2014 onwards only.