Anyone hot on tax codes (PAYE)?

[gorrie]

I received a new PAYE tax code through the post last week (for the 2010/2011 year... that we are already 3/4 way through) and I'm somewhat baffled.
Basically, I've had my tax code reduced by around £3K, which they say is due to employer benefits 'they think I may get this year', ie, They have looked at my P11D from the previous year and have decided 9mths in that they should use that as a basis for the 2010/2011 as well rather than wait for me to submit final figures in my 2010/11 Self Assessment. The fact that those employer benefits vary year to year, depending on how much I have used certain services/benefits (and I'm pretty sure I haven't received as many benefits in 2010/11) doesn't seem to matter.

It also does not take in to consideration that on my 2010/11 Self Assessment I will include payments made in to personal pension plans PLUS any travel/mileage at the 40p/per mile.... which typically offset items on my P11D (sometimes I'm underpaid a little, sometimes overpaid a little... but it's usually small fry).
Upshot is, I'll be going on to the new tax code for the remainder of this tax year (3mths) in order to try and collect any 'hypothetical' underpayment for the 2010/2011 tax year (which is going to hurt the wage packet doing so over such a short period) and then once I submit my SA for 2010/11 they will probably have to give me the majority of that back again as their underpayment calculation is off the mark.

I thought the point of PAYE was to tax you on your regular pay at source... and Self Assessment was meant to pick up these benefit/expense type things which you can then pay in a lump sum or via your next years tax code??
Sounds like I'm effectively giving them a free loan, under the guise that the 'think' I may get some benefit over the current year.

[RDH]

Just phone them up, and kick up a fuss.
There was a message on our work Intranet yesterday saying pretty much the same thing you've described, so you're not alone.

[craig1983]

I'm in the same boat mate, HMRC have reduced my tax code meaning i'm paying them a fortune in income tax. From discussions with my accountant....HMRC have screwed up. They've calculated tax codes taking into account something on the P11D which they're not meant to....the 'Employer Benefits' section in my case. Contact your accountant if you have one and have them query it with HMRC....but once your tax return is filed with them, which includes an expenses claim section, then they should reissue a correct tax code.

Annoys me that HMRC can screw up without any repercussions, yet if we're a week late in submitting something....we get fined.

[mac]

Just phone them up, and kick up a fuss.
There was a message on our work Intranet yesterday saying pretty much the same thing you've described, so you're not alone.

Ah, Mandy was on asking about the details on her payslip as there were are few in her office who had a similar issue.

Hoping she didn't just tell them to phone Finance and ask for Robert

[GraemeLotus]

Yep I reckon this is a national issue, everyone's code who I've spoken to has been changed for the worse.....not as bad a mine though as I'll have an emergency code this month cos MMC fked up.

[gorrie]

I called them this morning, just before posting. Bloke on the phone tells me that they always stick 'estimated' P11D values on the coding notice for the year you are in.... which, as far as I am aware is nonsense.
I actually just got my 2009/2010 SA submitted the other night after battling to get re-enrolled for SA again (4th year they've closed it) ...and then getting my online thing re-activated.
I asked them to go re-evaluate based on the figures I submitted on that SA... but apparantly computer says no.
Need to call back in a few days time as the chap reckons it takes a few days for the SA to filter through all their system.
I asked him if it would generate a new PAYE code automatically or if I really did have to phone back.... and yep, I need to phone back & have exactly the same conversation again.

[craig1983]

My SA was submitted at the start of November....and they've still not fixed my tax code! let me know if they fix yours right away and i'll get on at them as well!!

[Dominic]

Just phone them up, and kick up a fuss.
.

There is a lot of this going on just now. Good luck in getting through - (you may be best to call first thing, or later in the day - their lines are open till 8PM)

[ClarkyBoy]

i was on hold for 36 mins.....but in fairness, they seemed helpful once i did get some human interface, however mine was not a tax code issue, and as helpful as they seemed on the phone, i have still not recieved any of the docs they said they would send me in the post...

[Dominic]

Best allow a few weeks for getting letters from them - not ideal when there is a return submission deadline to be met!

[alicrozier]

Feckers still dealing with my 07/08 SA...
Needless to say latest PAYE is FUBAR.

[Mr Momo]

Feckers still dealing with my 07/08 SA...
Needless to say latest PAYE is FUBAR.

That's bad - do they not have a time limit to resolve ? Worth chatting to a financial / legal person that can push HMRC to resolve (oh, like they exist ) ?

Just submitted mine and SWMBOs SAs and should be due a reasonable refund on her's - suggests codings are wrong....

[robin]

Sorted my PAYE code in 30 seconds today ... well, they said it was sorted, we'll see if they actually issue the new coding notice!

Cheers,
Robin

[gorrie]

My SA was submitted at the start of November....and they've still not fixed my tax code! let me know if they fix yours right away and i'll get on at them as well!!

Craig... called them back last night & they confirmed they had my 2009/10 SA.
I asked the guy to look at the SA calculation & then look at the 2010/2011 PAYE Code they recently issued where my code was reduced to the tune of £3K.
He saw my point about the company paid benefits not necessarily equating to the amount of tax I should pay as it didn't reflect things like Personal Allowances for travel etc...
We agreed that he would put my Code back up to what it was previously and if there was any ovre/underpayment then we'd just settle that at the time I do my 2010/11 SA.
Apparantly it may take a number of weeks for a paper copy to be issued to me (the last one arrived 2-3 weeks after it was dated), but the guy said my company should get electronic notification of the change through their system, so should be a matter of days for them. Hopefully that means my pay from Feb will be back to normal again.

Might be worth you calling them, if you think yours is still wrong.

On another note... that's the first time I've actually gotten through to someone in IR who gave the impression that they were remotely interested.

[robin]

Yes, the P11D submitted by companies list all expenses paid to you and there is no scope for them recording on the form which expenses are (probably) not taxable and thus should not go into your coding but rather should wait until SA time. HMRC assume any expenses on P11D are taxable until you call up and tell them they aren't; there is no requirement to justify your claim, they will just update your coding because you ask them to.

The personal taxation people, when challenged, often say it's your employer's fault. So I asked them to clarify what my employer (that's me, indirectly ) had done wrong. They said they couldn't comment and it was something I would have to take up with the employer's help line. So I called them and asked them what I was doing wrong. They said I should be entering a balancing entry. Cool, said I, where do I put it? Err, can you hold. 5 minutes later they return with "actually, there is no where to put it". So then I asked them why the system worked this way. Most expenses are going to be non-taxable, and so the revenue wastes much time and paper issuing broken coding notices that then cause people to waste time calling them up, which then wastes the revenue's time again to fix the coding and issue new coding notices. "Oh, that's just the way it is, Sir." When I asked whether I could speak to somebody who could explain WHY it was that way, I was told I would need to talk to a technical advisor, but none were available at this time. I think I might email Mr Cameron and Mr Osbourne (sp?) to see whether they can shed any light on this stupid waste of resources.

Anyway, my new coding notice was issued electronically to my employer the next day (possibly sooner, I didn't check).

Cheers,
Robin