Tax to repay - Child Benefit
Discussion
RYH64E said:
The couple of quid your bank deposits every quarter that's only been taxed at basic rate... As I said, don't take my word for it, I'm no expert.
I made the point on page 1 - anyone earning enough to make them pay higher rate tax should be completing a tax return, even if it just to account for the difference in tax due on bank interest!sidicks said:
RYH64E said:
The couple of quid your bank deposits every quarter that's only been taxed at basic rate... As I said, don't take my word for it, I'm no expert.
I made the point on page 1 - anyone earning enough to make them pay higher rate tax should be completing a tax return, even if it just to account for the difference in tax due on bank interest!https://www.gov.uk/apply-tax-free-interest-on-savi...
But, are people just expected to know this through osmosis or something. I've just learnt something new.
Eric Mc said:
Car allowance is taxed just like salary so would be considered part of Gross Salary and would count towards the £50,000 total.
A normal Company Car BIK would NOT count.
I was talking about an PERSONAL pension contributions made directly by the taxpayer. Using a PERSONAL pension contribution payment is a legitimate planning device to get you below the £50,000 - £60,000 threshold.
Sorry to bring this back up but i'm not sure it's correct. My total income for this year was judged to be over £50K and the only things taking me over were my company car BIK (not fuel) and private medical insurance.A normal Company Car BIK would NOT count.
I was talking about an PERSONAL pension contributions made directly by the taxpayer. Using a PERSONAL pension contribution payment is a legitimate planning device to get you below the £50,000 - £60,000 threshold.
If you look on HMRC's child benefit calculator and insert your figures with and without the company car BIK included, it shows that the amount is included within your income and you have to pay tax based on it.
It's one of the reasons i opted out of the company car scheme in December last year.
RYH64E said:
I would have thought anyone close to having their Child Benefit withdrawn would be on Self Assessment anyway?
Not at all. There is no requirement to do a self assessement until you hit 100k.I was doing them, then HMRC, told me not to bother & they would tell me if I needed to do them. Most peoples tax affairs are (were) very simple. PAYE, no other sources of income, no bank interest. Not everybody fits the PH stereotype.
It's only the constant meddling with allowances/benefits, etc, that are causing these problems. The government is making things far more complex than it needs to be. And if you can't understand what nonsense they have developed it's your fault & they will fine or penalise you.
GT03ROB said:
Not at all. There is no requirement to do a self assessement until you hit 100k.
As I understand it, you are responsible for ensuring you have paid the correct amount of tax - inevitably that means completing a tax return if you pay the higher rate of tax on your income,GT03ROB said:
I was doing them, then HMRC, told me not to bother & they would tell me if I needed to do them. Most peoples tax affairs are (were) very simple. PAYE, no other sources of income, no bank interest. Not everybody fits the PH stereotype.
I'd be amazed that anyone earning income in the higher tax bucket did not also have a bank account that was paying interest, however small.GT03ROB said:
It's only the constant meddling with allowances/benefits, etc, that are causing these problems. The government is making things far more complex than it needs to be. And if you can't understand what nonsense they have developed it's your fault & they will fine or penalise you.
Agreed.sidicks said:
GT03ROB said:
Not at all. There is no requirement to do a self assessement until you hit 100k.
As I understand it, you are responsible for ensuring you have paid the correct amount of tax - inevitably that means completing a tax return if you pay the higher rate of tax on your income,sidicks said:
GT03ROB said:
I was doing them, then HMRC, told me not to bother & they would tell me if I needed to do them. Most peoples tax affairs are (were) very simple. PAYE, no other sources of income, no bank interest. Not everybody fits the PH stereotype.
I'd be amazed that anyone earning income in the higher tax bucket did not also have a bank account that was paying interest, however small.,The law says that it is the taxpayer is supposed to recognise when they should be completing SA returns.
If HMRC writes to a taxpayer saying they don't need to complete one, it is STILL the taxpayer's responsibility to ignore that letter and keep completing them.
I think it is very wrong for HMRC to write these letters as it makes it seem to the taxpayer that HMRC has the legal power in this area. They don't.
If you read these letter correctly, you will always see that they say "We THINK you do not need to complete self assessment tax returns in future". That is their get-out.
If HMRC writes to a taxpayer saying they don't need to complete one, it is STILL the taxpayer's responsibility to ignore that letter and keep completing them.
I think it is very wrong for HMRC to write these letters as it makes it seem to the taxpayer that HMRC has the legal power in this area. They don't.
If you read these letter correctly, you will always see that they say "We THINK you do not need to complete self assessment tax returns in future". That is their get-out.
lenny007 said:
Sorry to bring this back up but i'm not sure it's correct. My total income for this year was judged to be over £50K and the only things taking me over were my company car BIK (not fuel) and private medical insurance.
If you look on HMRC's child benefit calculator and insert your figures with and without the company car BIK included, it shows that the amount is included within your income and you have to pay tax based on it.
It's one of the reasons i opted out of the company car scheme in December last year.
Sorry - my error.If you look on HMRC's child benefit calculator and insert your figures with and without the company car BIK included, it shows that the amount is included within your income and you have to pay tax based on it.
It's one of the reasons i opted out of the company car scheme in December last year.
The threshold DOES include any BIKs.
Off to read up on the scheme a bit more carefully.
Eric Mc said:
The law says that it is the taxpayer is supposed to recognise when they should be completing SA returns.
If HMRC writes to a taxpayer saying they don't need to complete one, it is STILL the taxpayer's responsibility to ignore that letter and keep completing them.
I think it is very wrong for HMRC to write these letters as it makes it seem to the taxpayer that HMRC has the legal power in this area. They don't.
If you read these letter correctly, you will always see that they say "We THINK you do not need to complete self assessment tax returns in future". That is their get-out.
It's crazy though. In my wife's case, she is now a senior teacher in a secondary school. She started there 15 years ago and worked her way up the ladder. If HMRC writes to a taxpayer saying they don't need to complete one, it is STILL the taxpayer's responsibility to ignore that letter and keep completing them.
I think it is very wrong for HMRC to write these letters as it makes it seem to the taxpayer that HMRC has the legal power in this area. They don't.
If you read these letter correctly, you will always see that they say "We THINK you do not need to complete self assessment tax returns in future". That is their get-out.
She's always had just one source of income, paye, never had any dealings with hmrc, never needed to. No interest in tax or accountancy affairs. How is someone like that meant to know that technically they should be submitting self assessment forms so the HMRC can get an extra 75p a month off interest paid on account interest.
Surely that costs more to administer than it recovers?
GT03ROB said:
Agreed, but if it is correct, through codings you still don't need to submit one. As I said I was told not to bother by HMRC.
But codings can't take into account an unknown amount of future interest!GT03ROB said:
Well I did not. Using offset mortgages you receive zero interest.
Ok, fair point.dave_s13 said:
It's crazy though. .....
Surely that costs more to administer than it recovers?
It may be crazy, but it's true.Surely that costs more to administer than it recovers?
It may cost more - but the extra cost mainly falls on the shoulders of the taxpayer rather than the exchequer.
PAYE is increasingly failing to tax people properly or accurately. As a result, I think the need for Higher Rate Taxpayers to seriously consider signing up for Self Assessment is growing.
It can be a very useful exercise and will probably SAVE you more tax rather than make you pay more.
dave_s13 said:
It's crazy though. In my wife's case, she is now a senior teacher in a secondary school. She started there 15 years ago and worked her way up the ladder.
She's always had just one source of income, paye, never had any dealings with hmrc, never needed to. No interest in tax or accountancy affairs. How is someone like that meant to know that technically they should be submitting self assessment forms so the HMRC can get an extra 75p a month off interest paid on account interest.
Surely that costs more to administer than it recovers?
I doubt the HMRC would care in such a case.She's always had just one source of income, paye, never had any dealings with hmrc, never needed to. No interest in tax or accountancy affairs. How is someone like that meant to know that technically they should be submitting self assessment forms so the HMRC can get an extra 75p a month off interest paid on account interest.
Surely that costs more to administer than it recovers?
Anyone who has built up significant savings will probably have put them in a more efficient form, such as ISAs. Which don't have to be declared.
The problem is that many, many taxpayers who have only ever been taxed under PAYE seem to be under the illusion that the PAYE system is deducting the correct tax from their income. In many, many cases it is not.
HMRC does tell taxpayers to check their coding notices and to contact them if they think it's wrong.
The problem is that far too many people don't bother checking or don't understand how the coding system works - so they can't tell if their PAYE is right or wrong.
Sadly, knowing whether it is right or wrong is primarilly the responsibility of the taxpayer and assuming that all is OK can be an expensive mistake.
HMRC does tell taxpayers to check their coding notices and to contact them if they think it's wrong.
The problem is that far too many people don't bother checking or don't understand how the coding system works - so they can't tell if their PAYE is right or wrong.
Sadly, knowing whether it is right or wrong is primarilly the responsibility of the taxpayer and assuming that all is OK can be an expensive mistake.
The big problem is all those who get away without paying anything or nothing like their full whack, if you are PAYE you are screwed.
Lots will be not paying their full whack, so benefits kick in, they get to keep the CB yet are earning more than their PAYE counterpart, I have a mate that gleefully tells me how little tax he pays and how everything "is through the company", a massive new telly for his front room, bought as a business expense.
I cant blame him really but there will be millions like that, it is rife.
Lots will be not paying their full whack, so benefits kick in, they get to keep the CB yet are earning more than their PAYE counterpart, I have a mate that gleefully tells me how little tax he pays and how everything "is through the company", a massive new telly for his front room, bought as a business expense.
I cant blame him really but there will be millions like that, it is rife.
J4CKO said:
The big problem is all those who get away without paying anything or nothing like their full whack, if you are PAYE you are screwed.
Lots will be not paying their full whack, so benefits kick in, they get to keep the CB yet are earning more than their PAYE counterpart, I have a mate that gleefully tells me how little tax he pays and how everything "is through the company", a massive new telly for his front room, bought as a business expense.
I cant blame him really but there will be millions like that, it is rife.
That is deliberate and fraudulent tax avoidance. No way is that a legitimate business expenses. Have you shopped him?Lots will be not paying their full whack, so benefits kick in, they get to keep the CB yet are earning more than their PAYE counterpart, I have a mate that gleefully tells me how little tax he pays and how everything "is through the company", a massive new telly for his front room, bought as a business expense.
I cant blame him really but there will be millions like that, it is rife.
pork911 said:
so to be clear, do you NEED the child benefit?
if yes, why did you have kids you can't afford?
if no, why are you scrounging?
I am in the same boat as the OP that you're being obtuse with.if yes, why did you have kids you can't afford?
if no, why are you scrounging?
My issue is not whether I receive CB or not as I know I'm on a decent income.
The problem I have is the way they base the criteria on one income and not household?
See my earlier post on this thread for the numbers.
I filled my SA form in last year for the tax year just gone and have to repay the child benefit I was paid. I didn't cancel the CB as I was in the zone where you got some of it but what with promotions and my miscalculation that the BIK of my co. car is classed as an income, I have to pay it all back. So a negative tax code for me from April!
Steve
Steve
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