Tax - TSR guide and questions thread

Hi,

So.... In the tax year 2009/10 I worked for a few months but paid tax as if I was working for the whole year and will thus be owed tax.

Basically from 1st April 2009 to June 18th 2009 I was earning 20,500 pro rata and from June 18th 2009 to Aug 28th I was earning 24,000 pro rata.

That's all the work I did that tax year.... therefore how much tax am I owed?

I have a figure I calculated but just want to check it reconciles. Nb. I have the normal tax code...

Thanks

Your manager is correct that after the end of each tax year, you will need to reclaim any overpaid Income tax directly from HMRC rather than from your employer. Income Tax overpayments on employment income during the current tax year can be dealt with via the 'Pay As You Earn' (PAYE) system that's used to collect Income Tax and National Insurance Contributions from employees, but this doesn't extend to overpayments from previous tax years.

However, claiming back the overpayment shouldn't be hard. Given that you were employed at this job at the end of the tax year and have now received your form P60 for the 2009/20 tax year, you should write to your tax office enclosing a copy of your P60 and explaining that you'd like to claim a refund of the overpaid Income Tax. You can find contact details for your tax office here: http://search2.hmrc.gov.uk/kbroker/hmrc/locator/locator.jsp?type=1

Now, you should also check what's happening in the new tax year (which started on 6 April 2010). Check the 'tax code' shown on your payslip. If this is "647L" (with no suffix, such as "M1" or "W1[noparse]")[/noparse] then most likely everything's dine. If it's not "647L" (most commonly it might be "BR" or "647L W1[noparse]")[/noparse] then you may still be taxed incorrectly in this new tax year. If you've completed a form P46 for your employer and this has had no effect then call your tax office again and explain this to them. They may be able to send a notice to your employer specifying the correct tax code to use. One this is in place, if you've overpaid any Income Tax on employment income since 6 April then you should receive a refund of this through the payroll system the next time that you're paid.

It seems like a nightmare trying to get it back at the moment
My tax code on my playslip was BR1 before April and now its BR0, in my old job last summer though it was 647L but they didnt tax me at all!
I completed a P46 last Saturday and my manager was supposed to send it off, but she told me today she hasnt! But its her duty to fill in the P46 even if it isnt the companys responsibility to claim the tax back because she should have done the P46 when I started in November!

So I've printed another one off so should I just take it to work, fill it in and send it off myself with my P60 to the tax office? And with a letter saying that I want to claim tax back?

My manager also said that the company I work for has a really bad reputation with the tax office (which is North East Metropolitan Area) but that shouldnt stop me being able to claim my tax back!

Thanks for the advice anyway x

Why would you get a refund?? You obviously never gave in or your work never sent off your P45 so the money never showed up, but you still earnt over £7000 so you wouldn't get anything??

I've paid too much tax, whether they add my wages from the part-time job or not, so either way, I will get a refund, it's just either a £300ish refund or a £700 refund.

I handed in the slip from my part-time job which stated how much I earned to my new employer and my tax code changed from BR to 647L, so I'm not sure what happened...

I've paid too much tax, whether they add my wages from the part-time job or not, so either way, I will get a refund, it's just either a £300ish refund or a £700 refund.

I handed in the slip from my part-time job which stated how much I earned to my new employer and my tax code changed from BR to 647L, so I'm not sure what happened...

A "BR" tax code means that you are treated as having a zero personal allowance, rather than the standard £6,475 - this will be why you have been taxed on your income when using this code. Without going into the full mechanics of PAYE, I'd expect you to pay no Income Tax with a code of "647L" given your current level of earnings, so the treatment during your previous job sounds fine.

It does sound like you're being badly treated by your employer with them not processing your P46 from November. If they had done so, I'd expect you to have been put onto the correct tax code (probably, though not definitely, "647L[noparse]")[/noparse]. If you have no confidence that they'll process the form if you complete a second once then I strongly recommend discussing this over the phone with your tax office, as they are there to help with this sort of thing.

However, the good news id that whatever the state of your employer's relationship with the tax authorities this shouldn't affect your ability to reclaim overpaid Income Tax from previous tax years. For this, the P46 isn't relevant. All that you'll need to send to your tax office is a copy of your P60 with a cover letter explaining that you'd like a refund. As a worst-case scenario, if you're unable to get your tax code corrected then the route of contacting your tax office directly for a refund will still be open to you for tax that you're suffering in the new tax year, though you'll have to wait until the end of the tax year or until you leave the job.

If you leave the job before the end of the tax year, the reclaim procedure is a bit different, as there's a form to complete (a P50: http://www.hmrc.gov.uk/pdfs/p50.pdf) and you should accompany this with Parts 2 and 3 of the P45 that you should receive from your employer when you leave them, rather than a P60.

I read if u get payed under £110 a week then national insurance is not taken from ur salary and also if u earn below a certain amount per annum then u also wont pay taxes

so if i work for about 20hours a week and get paid £4.35, would my wages be taxed at all?

You're correct about not having to pay NIC if your weekly earnings from a job are below £110. As for income tax, you need to consider you total annual income from all sources to determine whether you should be paying Income Tax for the year. Generally, everyone in the UK can earn up to a certain amount (known as their 'personal allowance') without having to pay any Income Tax, and for the current tax year (running from 6 April 2010 to 5 April 2011) this allowance is £6,475 for most people. Running the numbers...

20 hours/week @ £4.35/hour = £87/week, equivalent to £4,524 p/a

As this is below the standard personal allowance then I wouldn't expect you to have any Income Tax or NI deductions if this is your only source of income. However, do check that your employer is using the correct 'tax code' to calculate your Income Tax deductions. This code will be shown on your payslips, and a code of "647L" (with no suffix) indicates the standard personal allowance. If it isn't this then it may be worth querying why with your emplloyer and/or your tax office.

can somoeone tell me the procedure for this and what I need to do?

I lost my job around Christmas time and began signing on a few months ago.
A while ago i sent my P45 to the HRMC to get a tax rebate, but they sent it back to me with a letter saying they 'couldn't pay me the refund as I had recently began claiming JSA' It then say that 'i may wish to review the tax position after April 5th'.

I am still on JSA. Am i supposed to just send it all away again now, considering April 5th has now passed??

Also, the jobcentre sent me a statement this morning with various tax information on it : - 'A certificate of taxable pay and benefit'
Is this something to do with it?? Do i need to send it all away together again??

Someone else told me that it should have all been done automatically for me a few weeks ago if you are still claiming???

cheers.

That form is probably a P60U (if not, please post again with the name stated on the form), and this is what you need to reclaim any overpaid Income Tax if you're on JSA until the end of the tax year (5 April each year). You'll need to write to your tax office (contact details here) requesting a refund of any overpayment and enclosing a copy of that form and Parts 2 and 3 of your P45. Refunds of overpaid Income Tax from previous years won't usually be made unless you actively request them.

Thanks!
I knew someone would know! Yes, the form is a P60U.
So send it away with my P45 (part 2 and 3)

Thats what i assumed, but there seems to be lots of missinformation out there when i was researching. Shame that they dont make these things MUCH much clearer. They're very clear when its them taking money from you! lol

Cheers.