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PAYE Tax underpayment

Discussion in 'General Chat' started by Scamps, Mar 3, 2011.

  1. Scamps
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    Scamps Member

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    Just come home to a nice letter from HM Revenue & Customs saying I owe them money..... £1,500.
    Reading the 6 pages of calculations and guidance notes it's because:

    Wrong Tax code 08-09.
    Wrong Tax code 09-10. It changed to claw back underpayment from 08-09, but they didn't claw back enough.
    Wrong Tax code 10-11. Again, was altered to claw back underpayments from 08-09 & 09-10 but they got it wrong leaving me owing £1.5k which they say they'll take using my tax code during 11-12.
    :banghead::banghead::banghead:

    Anybody knowledgable on this? Been through a similar situation or have advice? I'm going to go back through my payslips/P60s and check on company car details for the period as this is where they keep cocking up. Not happy..
    #1
  2. consilio
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    consilio Up the owls!

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    Just to hijack this thread a little. I have a straight forward tax situation, no company car or other benefits etc, just my salary. I havent had a letter yet but it seems a lot of people have. Could they screw up a simple tax scenario such as mine or should I be ok?
    #2
  3. jcs356
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    jcs356 Brum brum

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    Problem is that they tried to integrate a number of their IT systems a few years ago and shall we say, it didn't go well. So a process that had worked ok for many years suddenly went completely t*ts up.

    Scamps - your lucky it is under £2k as they can get this back via PAYE. More than £2k and you have to pay them back now. They initial letter gives you something like 28 days to pay up, but if you can get through to them (be prepared for 1 hour plus on hold), they will negotiate a repayment schedule of up to 3 years if you argue hardship etc. etc.

    Consilio - you should be ok. It tends to have gone wrong on people who have a number of benefits (company car seems to be one of the big problem areas).

    From my position - I'm lucky in that I run my own company and I do my own payroll so I can influence things. My tax code this year is completely wrong - they set it to zero on the basis they think I'll be earning over £112k (wrong), but then gave me back £3000 as higher rate tax relief for personal pension contributions - based upon a pension I haven't contributed to since December 2005! I did try to contact them but they are so snowed under I didn't see me getting a response any time soon.

    On that basis I've ignored their tax code and paid myself with a 0 code, so I know I have overpaid tax this year. Hence I'll be doing my tax return mid April i.e. nice and early, as I know they will owe me for a change.
    #3
  4. Nilz
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    Nilz Defo worth the wait :)

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    I had a letter recently as well, due to wrong tax code, but this was in 07-08, so hopefully, will be able to get it cleared, due to how long ago it was, I have checked with my payroll dept and we did everything as we should have done.

    I am waiting for them to come back to me now, which is God knows when!!

    There is already a thread for this in the Rants section.....fair bit of info in there as well.
    #4
  5. eoeumc
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    eoeumc Member

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    I had a tax refund last year. Not much around £115 I think it was. Better than a kick in the teeth like Scamps got :(
    #5
  6. Turkster
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    Turkster Bro.Paul 2.5TDI Quattro Sport

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    what are you all worried about?

    you don't have to pay any such tax on your earnings by LAW you only have to give it if you give consent to paying your money so others can do what ever they like with it,

    The last time i looked at the floor i see LAND not SEA water, and the only LAW of the LAND is COMMON LAW not Statutes and Acts which are commercial trading laws for the SEA, unless your not a human and your are in fact a BOAT ?

    Dont take my word for anything iv just said,

    Educate yourself for free here,
    Tpuc.org Forum • View forum - Income Tax
    #6
  7. BigBird
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    BigBird Lost in music...

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    Just got letters & statements that seem worded that I owe the taxman money, but the amounts tie in exactly with two overpayment rebate cheques I got of around £100.

    Really badly worded letter that seemed to totally contradict the enclosed tax statements...
    #7
  8. Ads
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    Ads License to drive

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    I've just received a tax calculation stating that I have underpaid tax and therefore owe them money. It dates back to 2005 for me.
    I've spoken to them and have asked them to provide proof of the underpayment, showing breakdowns and their calculations.
    Said they'd call me back.

    A word of advice for anyone who has received a similar letter..... we are near the end of the 2010/2011 tax year so the calculations you have received will only be based up to the end of the 2009/2010 tax year (so, April 2010).... so if you know how to, when you receive your march pay calculate whether you've overpaid/underpaid/paid the right amount for 2010/2011 tax year (the current one).

    I say this because in my situation, and even if they are correct that i underpaid tax between 2005-2009, i have actually overpaid tax in this financial year which totally offsets what they say I owe them, therefore it is them who owes me money overall.

    As soon as I get my march payslip i'll have a full years records and will ask them to recalculate my tax position including 2010/2011.

    Just something to bear in mind.
    #8
  9. kirsty76
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    kirsty76 Member

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    i dont understand how when you owe them money they want it back straight away but when they owe you money they mess you around for as long as possible and tell you they dont have to pay you back for a year, i had to wait 8 months till i was able to get a refund of £800 quid that they owed me.
    #9
  10. Scamps
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    Scamps Member

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    Aythreee - That's a fair point on looking into the 2010/2011 financial year, as I worked out last night i've already paid off £550 of the supposed underpayment during this period..... so I owe them a little over £900 now, not £1,500.
    However, my Tax code was wrong again for 2010/2011 so I think this amount will have gone up + it's wrong for 2011/2012 ffs.....:banghead:
    I've got my head round it now and I'm sending them a letter this weekend. Definately a lesson in checking your tax code regularly. Just to confuse the issue further, my company car should change soon & I'll have to change tax code again:blink::readit:
    #10
  11. Ads
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    Ads License to drive

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    Bit of an update on my apparent underpayment of tax:

    As I mentioned above, I received a letter stating that I hadn't paid enough tax so I called them querying it.
    Anyway, I have just received another letter and a cheque for almost £400 as it turns out I had paid too much tax rather than not enough.

    So basically, don't just accept the tax office's calculations, triple check them.

    I've gone from owing £700 to being owed £400 in the space of a short phone call.
    #11
  12. OldRedEyes
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    OldRedEyes Member

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    I have had company car's for the last 12 years, and last year got a letter saying i had underpaid tax for nearly a year as they hadn't included my company car in the calculation.

    What had happened was they recalculated wrongly and my company noticed it and informed them instantly (they had done it with the whole fleet of 50+), i tried phoning them but they refused to answer me on the phone and said i would have to write to them. Being a lazy bstard i didn't bother.

    Cut to 6 months later and whilst off on the sick i thought i would try phoning them again, this time i must have got a nice girl on the phone ( she certainly sounded it ;o)), and she sorted it out and due to having been on a K code for several months, i got a nice rebate in the form of not paying any tax for a month (well almost none).

    have a new car now and the tax code has gone up nicely due to lower emissions

    Happy days
    #12
  13. eno394
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    eno394 Member

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    Had a tax code of K354 for all of last year due to them not having received my P11D when I went from a Vectra to an A4. Had the B7 Sline and the emissions were far too high!

    Having recently changed to the new B8 Sline my new code is now K121 for April 11. Scared to ask them to look for a rebate for the last 6 years just in case they come back saying I owe them again!!
    #13
  14. beanoir
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    beanoir Sharpest Tongue in the West

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    I've had calculation letters, the result is I owe them a not insignificant amount for company benefits which were calculated incorrectly. There are 2 things to remember that will assist you in your conversations with HMRC

    1) you DO NOT have to pay it on demand, you can pay it back over a period of time. I refused point blank under the pretence that It took them 3 years to realise their errors, so I would pay them back over a period of 3 years, which is what I am doing from April onwards.

    2) If your underpayment goes back further than 2010 then it is likely as a result of their change of internal computer systems. I know and can prove that my P60 was sent to HMRC and correctly notified to them for 08/09 and yet they failed to act on it, this is (by their own acknowledgement) due to the change to a new system, and therefor adds more weight to argument 1) above.

    Good luck, because most people i've had the pleasure of speaking to at HMRC are either useless or a*seholes
    #14
  15. freddie 5
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    freddie 5 New Member

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    Ive had a demand for £1600 going back to 08/09. They have been good enough to change my tax code so that I can repay it. They are a nice bunch of people.
    #15

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