cancel
Showing results for 
Search instead for 
Did you mean: 

Six million facing tax shocker

Steve
Pro
Posts: 6,679
Thanks: 247
Registered: 13-07-2009

Six million facing tax shocker

Quote
Nearly six million people will be informed over the coming months that they have paid the wrong amount of tax, with about 1.4 million facing demands for more payments, it was revealed.
A total of £2 billion has been underpaid through the Pay as You Earn (PAYE) system over the past two years, meaning that the 1.4 million taxpayers will be required to shell out an average of almost £1,500 each.

All the details here...http://news.uk.msn.com/uk/articles.aspx?cp-documentid=154580362
13 REPLIES
nadger
Rising Star
Posts: 4,498
Thanks: 46
Registered: 13-04-2007

Re: Six million facing tax shocker

I see that the amount underpaid and overpaid almost match so no overall gain to the system.
I'm not affected, either way, but I do feel that people who've provided accurate information shouldn't be penalised.
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Six million facing tax shocker

not sure but my pension is PAYG, although it is fixed every month
nadger
Rising Star
Posts: 4,498
Thanks: 46
Registered: 13-04-2007

Re: Six million facing tax shocker

Quote from: pierre_pierre
not sure but my pension is PAYG,
Would that actually be PAYE  Wink
I was self-employed from the early 1970s so always did my own tax.
With both of us above 65 our combined allowances do exceed our income so we are clear of income tax.
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Six million facing tax shocker

somehow, dont know why, the SWMBO is on a separate tax, most of our bank savings are in her name and dont reach her allowance, but mine is an other matter, 43 years in a final salary pension
nadger
Rising Star
Posts: 4,498
Thanks: 46
Registered: 13-04-2007

Re: Six million facing tax shocker

I'd have thought that you could transfer any unused allowance - possibly worth investigating.
I wonder how many people will now spend 43 years with the same employer. My father retired from a bank at 60 and must have done a similar period.
Moderator
Moderator
Posts: 25,756
Thanks: 1,120
Fixes: 47
Registered: 14-04-2007

Re: Six million facing tax shocker

There was a suggestion that an under payment could be appealed and written off although write off's would not be automatic.
Customer and Forum Moderator.
Product of the Tyrell Corporation
VileReynard
Seasoned Pro
Posts: 10,580
Thanks: 191
Fixes: 9
Registered: 01-09-2007

Re: Six million facing tax shocker

I've received 2 sets of 4 coding notices, since April. All posted separately. Grin
But the funny thing is that I will still overpay - but because my income is less than a single persons allowance, they will still have to send me some cash next year. Grin Grin
My tax affairs are so complicated that I have to fill in the full tax return.
It gives someone a job, I suppose.
Good luck to them if they can understand the intricacies of foreign withholding taxes....

Community Veteran
Posts: 6,735
Thanks: 12
Registered: 02-02-2008

Re: Six million facing tax shocker

Quote from: nadger
I wonder how many people will now spend 43 years with the same employer.

My father-in-law did nearly 50 and has been drawing that pension for over 25 more!
Fortunately for him it's a local-authority one so has increased enough that it's still non-trivial.
Steve
Pro
Posts: 6,679
Thanks: 247
Registered: 13-07-2009

Re: Six million facing tax shocker

Quote
In some cases, HM Revenue & Customs will consider writing off demands where taxpayers can demonstrate that they provided all the information necessary to calculate their tax correctly.

The problems arise because at the end of each year, HMRC checks that the amounts deducted in tax and national insurance by employers using the PAYE system match up with the information held on their records. In the past, this was done manually on a case-by-case basis, but a new computer system has now been introduced to automate the checks.
An HM Revenue & Customs spokesman said: "The vast majority of the 40 million people who pay through PAYE deductions are correctly taxed, but because circumstances change during the year there will always be a minority who have paid either too much or too little.
"This year and going forward the new IT system will mean more people paying exactly the right tax at the right time than ever before."
VileReynard
Seasoned Pro
Posts: 10,580
Thanks: 191
Fixes: 9
Registered: 01-09-2007

Re: Six million facing tax shocker

Quote from: Steve
"This year and going forward the new IT system...."

I think you mean more people than ever before will experience chaos. Smiley

Community Veteran
Posts: 18,544
Thanks: 190
Registered: 12-08-2007

Re: Six million facing tax shocker

Apparently they have been putting all the codes for the past few years through a new computer programme to check them and this is how the errors were found.
Community Veteran
Posts: 3,291
Thanks: 2
Registered: 10-08-2007

Re: Six million facing tax shocker

Quote
but because circumstances change during the year there will always be a minority who have paid either too much or too little.

this is nothing new, it is always the case.
When they get their new computer working properly perhaps they can get their, not fit for purpose, website fixed
TicnTac
Grafter
Posts: 426
Registered: 03-08-2010

Re: Six million facing tax shocker

A few years ago I got a letter saying due to a possible system error, and missing information I 'may' need to top up £275 if I was to reach pension age and claim a state pension, note the 'if'  Roll eyes The letter got filed somewhere for when I'm bored!  Undecided
Still, I'd love to know the costings when my mother first retired, she got a letter from the tax people stating her pension was to be 7 1/2 pence a week! Yes seven and a half pennies!  Roll eyes That was 4 years ago. Father still in business, so she is unable to claim her full state, thankfully backed by a private pension - but even so, more money wasted!