Personal tax query


P

Paul

Hi,

Not sure if this is the best place to ask this but I need some advice with
my self assessment.

I've finally completed 2000-2001 / 2001-2002 self assesements last week
(yes, I know they were a bit late but that's another matter!) and yesterday
received the painful tax calculations. For 2000-2001 I owe £1600.83 & for
2001-2002 it's £788.66. Not the end of the world in the great scale of
things but I don't really have that sort of money available at my disposal
and I dread to think what interest / surchages they'll wack onto it :-(

I thought my tax affairs were all straight. All my earnings are PAYE, I'm
just into the higher tax bracket and have a company car & fuel card . I'd
never completed a tax return until I started with my current company in
April 2000. When I finally got round to completing the tax return it was
indeed very simple as I have no property, am single with no children, no
other incomes etc etc. All that was entered onto the self assessment form
was the information from my P60 & P11D. So it looks like the extra tax I am
required to pay is down to me underpaying tax due to the wrong tax code...

Which leaves me wondering why have I been supposedly underpaying tax for the
last two years. When I started with the company I was getting a new tax
code nearly every month. Initially the payroll department put me on the
wrong mileage allowance band but that was supposedly rectified by yet
another change in tax code, so is it them? Looking at my payslip I appear
to be paying lots of tax / NI (£569.80 Tax / £211.40 NI on a K73 tax code in
Feb 2002, which drops to £551.40 Tax / 215.00 NI on a 56L in April 2002 even
though my net pay increased by £90/month) . Our payroll / HR department are
incredibly arrogant and unhelpful at the best of times and have been known
in the past to make a complete hash of tax matters. Or is it the IR who
have not kept up with matters?

Does anyone have an idea as to my best approach on this one? I'm going to
see the IR asap & see if I can get to the bottom of it but what really gets
me is that it's a matter that is, in effect, out of my hands. Someone else
has screwed up my tax code yet I'm to pay! I wish I was working for myself
again, at least I'd only have myself to blame ;-) If it's the IR at fault
(ie not issuing me with a correct tax code) will they acknowledge & nullify
the demand? And if it's the payroll deparment will the IR accept it's not
my fault and hound them accordingly or, as I suspect, will I have to pay up
& argue the toss later?

Any help on this one would be greatfully received, thanks.

Paul.
 
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D

DP

If it's a coding error that led to tax being underpaid and there is no
dispute about the correct amount of tax payable, your best bet might be to
ask IR to collect the tax through your next tax code. They might agree.
 
A

Andrew

DP said:
If it's a coding error that led to tax being underpaid and there is no
dispute about the correct amount of tax payable, your best bet might be to
ask IR to collect the tax through your next tax code. They might agree.
No, they won't- the amount is too high. They can code out underpayments of
several hundred pounds, but here we are talking about £2,000.

It's no use crying over spilt milk, so I think you are going to have to roll
with any penalties for late filing and payment to the current date. Get in
touch with the Collector of Taxes at either Cumbernauld/Shipley depending on
who sends the bills (Don't contact the local tax office as they will not get
involved in collection matters, nor will the local collector at this stage)
and explain the situation. Most people are surprised when they realise how
amenable the IR can be to SENSIBLE instalment payments (i.e. not 50p per
month for the next 200 years!). The official line however is that the IR is
not a loan provider, and that if you are having difficulty you should first
make efforts to borrow the money to meet your commitments- as you would be
expected to if you fell behind with other outgoings.

They will want to see details of your income and outgoings, evidence that
you have applied for (and been turned down for) credit from reasonable
sources e.g. bank and partner and they will continue to charge interest.
 
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R

Ronald Raygun

Andrew said:
No, they won't- the amount is too high. They can code out underpayments of
several hundred pounds, but here we are talking about £2,000.

It's no use crying over spilt milk,
Actually, it is. Depends who spilt it. Reading between the lines,
there may well have been a cock-up at the OP's employer's salaries
office. If they deducted insufficient tax, and he spent the rest
in good faith, then *they* will have to cough up. They will not, of
course, necessarily have to donate the missing tax out of their pocket,
but it would certainly be reasonable for them to advance the shortfall
as an interest free loan over a reasonable period, and perhaps pay a
modest sum in compensation, even if it's only flowers, chocolates, and
bubbly.
 

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