HMRC gone to my PAYE Code
Discussion
Hi All
I do self assessment, (but I am also on PAYE), I never had an issue with it, paid the self assessment tax on time etc.
In November 2024, I submitted my self assessment tax return, done nothing really different, similar figure to last year, a week later, HMRC have issued me a new PAYE tax code. I was intending on paying the amount in January 2025, my wages vastly reduced from December to March 2025.
My preference, I liked keeping my self assessment payments separate from my PAYE earnings. I don't like my employee wages messed with.
The statement I have been served with, it’s confusing to fathom out why my wages over the months, vastly gone down to the amount in relation to the amount owed over the period.
HMRC, last week now issued me a new tax code from April 2025, for the financial year ahead, it’s not the standard 1257L, as the HMRC are forward projecting a £7k SA earnings profit.
I have written to HMRC requesting to go back to the old usual system, leaving my PAYE alone, as my preference.
My question can I do this, or am I just at the mercy of the HMRC with no choice?
Thanks
I do self assessment, (but I am also on PAYE), I never had an issue with it, paid the self assessment tax on time etc.
In November 2024, I submitted my self assessment tax return, done nothing really different, similar figure to last year, a week later, HMRC have issued me a new PAYE tax code. I was intending on paying the amount in January 2025, my wages vastly reduced from December to March 2025.
My preference, I liked keeping my self assessment payments separate from my PAYE earnings. I don't like my employee wages messed with.
The statement I have been served with, it’s confusing to fathom out why my wages over the months, vastly gone down to the amount in relation to the amount owed over the period.
HMRC, last week now issued me a new tax code from April 2025, for the financial year ahead, it’s not the standard 1257L, as the HMRC are forward projecting a £7k SA earnings profit.
I have written to HMRC requesting to go back to the old usual system, leaving my PAYE alone, as my preference.
My question can I do this, or am I just at the mercy of the HMRC with no choice?
Thanks
Edited by Nesty1760 on Friday 21st February 23:13
Edited by Nesty1760 on Friday 21st February 23:17
ok thanks, because for the next financial year I will be recording a loss, as no profits (spent a load on my rented house in renovation), I am keen to claim any refund promptly, which there should be, as already pre paid for the forwarding year.
Edited by Nesty1760 on Friday 21st February 23:42
Nesty1760 said:
ok thanks, because for the next financial year I will be recording a loss, as no profits (spent a load on my rented house in renovation), I am keen to claim any refund promptly, which there should be, as already pre paid for the forwarding year.
Wife and I just got refunds. Goodness knows how they calculate the repayment interest because the rate is supposed to be very low (vs late payment which is high) but we got far more than I expected, and it’s tax free too!If you complete Self Assessment tax returns, the default option is that you DO NOT give permission to HMRC to adjust the PAYE tax code. There is a specific box that you tick if you want your code adjusted.
Despite this, HMRC sometimes takes it upon themselves to mess with tax codes, even if they have not been given permission to do so.
Despite this, HMRC sometimes takes it upon themselves to mess with tax codes, even if they have not been given permission to do so.
Eric Mc said:
If you complete Self Assessment tax returns, the default option is that you DO NOT give permission to HMRC to adjust the PAYE tax code. There is a specific box that you tick if you want your code adjusted.
Despite this, HMRC sometimes takes it upon themselves to mess with tax codes, even if they have not been given permission to do so.
Thanks for this, I am sure I didn't do anything different, I reckon they just took it upon themselves. Despite this, HMRC sometimes takes it upon themselves to mess with tax codes, even if they have not been given permission to do so.
Nesty1760 said:
Ok thanks for the replies, I'll be submitting that new return in the first week of April, no tax for them to take, as no profit, in fact I will be wanting to record a write down loss, never done that before, so I'll have to look how to do that.
What type of loss?Trading loss?
Trading loss caused by Capital Allowance claim?
Tradingloss augmented by Capital Allowance claim?
Loss caused by R&D claim?
Rental loss?
Nesty1760 said:
This will be the first time in the tenancy, (being going 10 years), that I have made a loss.
I've claimed for certain maintenance etc, in the past, but there has always been a profit, too book.
However, this financial year I am at loss, to what I have paid out, to what I got in.
Correct me if I am wrong but you don’t get a refund on renovating costs vs tax code ….it does reduce your potential profits in that tax year but if you made a loss it can only be carried forward to next tax year …I've claimed for certain maintenance etc, in the past, but there has always been a profit, too book.
However, this financial year I am at loss, to what I have paid out, to what I got in.
Nesty1760 said:
This will be the first time in the tenancy, (being going 10 years), that I have made a loss.
I've claimed for certain maintenance etc, in the past, but there has always been a profit, too book.
However, this financial year I am at loss, to what I have paid out, to what I got in.
Is the calculation that simple? (as Eric is alluding to).I've claimed for certain maintenance etc, in the past, but there has always been a profit, too book.
However, this financial year I am at loss, to what I have paid out, to what I got in.
I'm not an expert, but a new bathroom should be added to the cost of the house when calculating gains/losses on disposal (rather than offsetting income in the period)?
On self assessment you have to pre pay the next year of tax potential rental earnings a year in advance, I have already paid HMRC effectively for this year potential earnings, however there isn’t any earnings, because there is a loss.
I shall be submitting a return in April 2025.
I would assume that HMRC have to pay me interest on that money or refund me, if I submit a loss for this year, because I have overpaid.
I have written to HMRC, about not touching my PAYE code from April 2025 and going back to self assessment payments. I'll submit my return in April and see what the HMRC outcome is.
Apologies, I should of mentioned about the self assessment pre payment
I shall be submitting a return in April 2025.
I would assume that HMRC have to pay me interest on that money or refund me, if I submit a loss for this year, because I have overpaid.
I have written to HMRC, about not touching my PAYE code from April 2025 and going back to self assessment payments. I'll submit my return in April and see what the HMRC outcome is.
Apologies, I should of mentioned about the self assessment pre payment
Edited by Nesty1760 on Sunday 23 February 13:02
What I was trying to get at is that not all expenditure on a rental property can be assumed to be offsetable against rental income.
If you are deducting capital costs - such as new bathrooms, extensions, loft conversions etc, then you are creating a loss whicjh is technically incorrect.
Capital costs - unless they are direct like-for-like replacements - are not allowed to be offset against the rental income.
An example -
The costs incurred in replacing old rotten wooden windows with modern wooden windows would be allowed.
If the wooden windows were replaced by state of the art PVA double glazed windows, that is looked on as an "enhancement" and not a repair or a replacement and is therefore not allowed to be offset against the rental income.
As has been mentioned, "enhancement expenditure" is added to the original cost of the property when computing any Capital Gain so you do get tax relief for it - but only when the property is disposed of.
If you are deducting capital costs - such as new bathrooms, extensions, loft conversions etc, then you are creating a loss whicjh is technically incorrect.
Capital costs - unless they are direct like-for-like replacements - are not allowed to be offset against the rental income.
An example -
The costs incurred in replacing old rotten wooden windows with modern wooden windows would be allowed.
If the wooden windows were replaced by state of the art PVA double glazed windows, that is looked on as an "enhancement" and not a repair or a replacement and is therefore not allowed to be offset against the rental income.
As has been mentioned, "enhancement expenditure" is added to the original cost of the property when computing any Capital Gain so you do get tax relief for it - but only when the property is disposed of.
Eric Mc said:
What I was trying to get at is that not all expenditure on a rental property can be assumed to be offsetable against rental income.
If you are deducting capital costs - such as new bathrooms, extensions, loft conversions etc, then you are creating a loss whicjh is technically incorrect.
Capital costs - unless they are direct like-for-like replacements - are not allowed to be offset against the rental income.
An example -
The costs incurred in replacing old rotten wooden windows with modern wooden windows would be allowed.
If the wooden windows were replaced by state of the art PVA double glazed windows, that is looked on as an "enhancement" and not a repair or a replacement and is therefore not allowed to be offset against the rental income.
As has been mentioned, "enhancement expenditure" is added to the original cost of the property when computing any Capital Gain so you do get tax relief for it - but only when the property is disposed of.
This is my understanding too and I split my repair/refurb costs appropriately when a long term tenant left and I needed to get the place back up to standard.If you are deducting capital costs - such as new bathrooms, extensions, loft conversions etc, then you are creating a loss whicjh is technically incorrect.
Capital costs - unless they are direct like-for-like replacements - are not allowed to be offset against the rental income.
An example -
The costs incurred in replacing old rotten wooden windows with modern wooden windows would be allowed.
If the wooden windows were replaced by state of the art PVA double glazed windows, that is looked on as an "enhancement" and not a repair or a replacement and is therefore not allowed to be offset against the rental income.
As has been mentioned, "enhancement expenditure" is added to the original cost of the property when computing any Capital Gain so you do get tax relief for it - but only when the property is disposed of.
One of my tenancies end on Friday and I'm going to sell. The place will need repairs/work before selling but I need to work out what is a repair as a result of the damage caused during the tenancy (Revenue) and what is improvement of the property ahead of selling (Capital).
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