Any tax experts on here?
Discussion
Hi All,
Long story short - Inland Revenue have messed up my tax. I discovered this in November last year and have been arguing with them since. I am taxed a source as PAYE and only have one job.
IR Changed me to basic tax rate (for a reason no one can explain) without telling me so an underpayment has mounted up over nearly a year until I spotted it and informed them. If I hadn't done so they would have been none the wiser but I have been honest and told them as soon as I realised. I have had 2 letters of apology from them and an offer of £25 (an insult) compensation but they maintain I have to stump up several thousand £ in underpaid tax by the 31st January.
I am now considering letting them take me to court then producing all the proof of how they have messed up my tax - which they have admitted in writing and hoping the Judge takes my side. What are my chances?
Long story short - Inland Revenue have messed up my tax. I discovered this in November last year and have been arguing with them since. I am taxed a source as PAYE and only have one job.
IR Changed me to basic tax rate (for a reason no one can explain) without telling me so an underpayment has mounted up over nearly a year until I spotted it and informed them. If I hadn't done so they would have been none the wiser but I have been honest and told them as soon as I realised. I have had 2 letters of apology from them and an offer of £25 (an insult) compensation but they maintain I have to stump up several thousand £ in underpaid tax by the 31st January.
I am now considering letting them take me to court then producing all the proof of how they have messed up my tax - which they have admitted in writing and hoping the Judge takes my side. What are my chances?
^^^ Yep. Just because they made a mistake won't get you off the tax bill, but I do think you have a case for requesting installments.
What do you hope to achieve in court? If you've earned the money then there's no dispute.
NB: If £25 is insulting, then had they offered you nothing you wouldn't have been insulted...
What do you hope to achieve in court? If you've earned the money then there's no dispute.
NB: If £25 is insulting, then had they offered you nothing you wouldn't have been insulted...
Edited by Simpo Two on Saturday 24th January 19:52
As others have said, you owe the tax and will have to pay it. However, I would push them for installments with no interest charges as it is their error. Advise them that their actions are completely against the Taxpayers Charter. And don't bother trying to negotiate with the person who will first answer your call (assuming you just dial the general number for the tax district). Advise them that you want to speak to the Inspector as you have a complaint to make.
This happened to someone I know. He pointed out that the Revenues incompetence was to blame, but he was quite happy to rectify their mistake by letting them change his tax code for the next tax year. Once the outstanding tax was paid off, they changed the tax code back to normal.
Sadly if a company did this, they would be a fault and would have to compromise. HMRC on the other hand are a law upon themselves.
Sadly if a company did this, they would be a fault and would have to compromise. HMRC on the other hand are a law upon themselves.
LC23 said:
As others have said, you owe the tax and will have to pay it. However, I would push them for installments with no interest charges as it is their error. Advise them that their actions are completely against the Taxpayers Charter. And don't bother trying to negotiate with the person who will first answer your call (assuming you just dial the general number for the tax district). Advise them that you want to speak to the Inspector as you have a complaint to make.
Yes - I am sure there is stuff on hmrc website about this - google it too. My code has now been changed.
I wasted a month last year trying to sort this with the pond life in the IR call centre - it is one of those who has caused me this problem in the first place by changing my code to basic rate, whoever it was should be fired. I am already at the second "Tier" of the IR complaints system they are not interested either. I just get letters back saying they are "very sorry ......your tax is due by 31st Jan".
They have no regard for the impact this has on people as a PAYE employee you don't expect (or budget for) a tax bill.
I wasted a month last year trying to sort this with the pond life in the IR call centre - it is one of those who has caused me this problem in the first place by changing my code to basic rate, whoever it was should be fired. I am already at the second "Tier" of the IR complaints system they are not interested either. I just get letters back saying they are "very sorry ......your tax is due by 31st Jan".
They have no regard for the impact this has on people as a PAYE employee you don't expect (or budget for) a tax bill.
anonymous said:
[redacted]
That is what I have been told - ultimately it is my responsibility, basically they can get it wrong as much as they like. I should have spotted the (unexpected) change in code on my payslip. I thought they would make a deal as it is me who has told them ! Thats what you get for being honest.Vron said:
anonymous said:
[redacted]
That is what I have been told - ultimately it is my responsibility, basically they can get it wrong as much as they like. I should have spotted the (unexpected) change in code on my payslip. I thought they would make a deal as it is me who has told them ! Thats what you get for being honest.Vron said:
They are not offering instalments as its more than £2K they have said its got to be paid by 31st otherwise interest is charged. I haven't budgeted for an unexpected bill of several thousand because the Inland Revenue are incompetent.
Equally you've known that you're not being taxed fully therefore the extra in your account each month is not really spending money ?You've had a interest free loan for a year. Treat it as that & nothing more.
Edited by Vee on Saturday 24th January 21:10
I did not know that my Tax code had been changed from higher rate to basic rate until I started to complete a self assessment in November last year. The IR never sent me a PAYE change of coding notice. When I submitted the self assesment form online instead of getting the reply back you do not owe any tax I got a reply saying I owe a lot. I then rang the Inland Revenue to ask what was wrong with their online service as I was PAYE taxed at source then the whole sorry tale started to unravel.
My salary varies each month so it is not a simple as you may think to have spotted any underpayment so I have not "enjoyed" the benefit of an interest free loan. This "loan" will not be interest free anyway as the IR want a lump sum back or face interest payments.
My salary varies each month so it is not a simple as you may think to have spotted any underpayment so I have not "enjoyed" the benefit of an interest free loan. This "loan" will not be interest free anyway as the IR want a lump sum back or face interest payments.
Soft Top said:
Surely basic rate means that you have overpaid them as you have not been getting the advantage of having a tax free allowance?
As such don't they owe you money rather than the other way round?
That is an interesting point because when I put my basic salary into an online calculator I was already paying £90 more a month tax than the calculator says I should and that figure is taken from a wage slip that has the dreaded BR (Basic Rate)code on it. The online calculator automatically adjusts for a higher tax rate so that makes things more confusing. On my new tax code issued in December according to my payslip I am paying £180 more a month tax than the calculator says I should????????????As such don't they owe you money rather than the other way round?
Do you not get any tax free allowance on Basic Rate? I am not an expert in tax as I have always been taxed at source.
They do not like installments when the amount due is too much as they feel they are doing without their rightful tax for too long. However, they normally allow up to £2,000 tax to be collected to an adjustment to the PAYE coding. I am not a fan of tax arrears being colected through Coding Adjustments as they can make the Coding Notice almost impossible to understand.
People need to know and understand their tax codings MUCH more than they do. As soon as their coding is changed, they should check the reason behind the change immediately.
On the whole, people who have Basic Rate tax applied in full to their salary tend to be paying too much tax on their income rather than too little - unless there is a genuine reason why BR has been applied to their salary or they are Higher Rate tax payers, In the latter case, a coding of BR may not be sufficient to enable the correct PAYE tax to be calculated on their salary.
People need to know and understand their tax codings MUCH more than they do. As soon as their coding is changed, they should check the reason behind the change immediately.
On the whole, people who have Basic Rate tax applied in full to their salary tend to be paying too much tax on their income rather than too little - unless there is a genuine reason why BR has been applied to their salary or they are Higher Rate tax payers, In the latter case, a coding of BR may not be sufficient to enable the correct PAYE tax to be calculated on their salary.
Argue your case, they'll back down eventually if they've cocked up.
I went through it a few years back, they cocked up my tax and the resulting argument that lasted about 18 months took a £600 bill up to £1400 in fines and interest.
All settled for £600 in the end, mainly due to the attitude of one person in the tax office.
I went through it a few years back, they cocked up my tax and the resulting argument that lasted about 18 months took a £600 bill up to £1400 in fines and interest.
All settled for £600 in the end, mainly due to the attitude of one person in the tax office.
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