How to handle the demands for underpaid tax

Discussion in 'PAYE letters 2010' started by [email protected], Nov 4, 2010.

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  1. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

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    The success in our first case brings with it a procedure to use in cases where:

    Exceptional Circumstances

    In exceptional circumstances, arrears notified less than 12 months after the end of the relevant tax year may be considered where both of the following apply:

    • HMRC failed more than once to make proper use of information received about a source of income

    • HMRC allowed tax arrears to build up over two whole tax years
    What this means:

    If you answer yes to the following then you can appeal and HMRC should write off the tax ….

    • Is the demand for underpaid tax for the years 2008 / 2009 and 2009 / 2010

    • Did you start receiving the income that HMRC are demanding tax on BEFORE 05/04/08?

    Watch this space as we will soon post a standard letter that you can send to HMRC to appeal against this including a case where they have applied this rule and written off £2,000 that a tax payer owed.

    [FONT=&quot](Please be patient – letter will be available on Tuesday 9th November 2010)

    Posted: Nov 4, 2010 By: [email protected] Member since: Nov 4, 2005
  2. Defogster

    Defogster UKBF Newcomer Free Member

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    Is the template letter available, if so where could I find it.

    Thanks in Advance.

    Posted: Jan 11, 2011 By: Defogster Member since: Jan 11, 2011
  3. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

    13,268 2,882
    Posted: Jan 11, 2011 By: [email protected] Member since: Nov 4, 2005
  4. nbeedham

    nbeedham UKBF Newcomer Free Member

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    Received 3 P800's last week – 2007/2008, 2008/2009 and 2009/2010 for £4747 in total (carried forward/rolling total over the 4 tax years)

    Personal circumstances are that I left the Royal Air Force after 28 years service and took up civilian employment. I started with my new employer 3 months prior to my 'end of Service' date and so had 2 incomes for that period. When my RAF wage ceased I was then eligible to receive my Service pension and have done so since. The timeline is as follows:

    Jan 2005 - Started transition to new employment. 2 wages.
    Apr 2005 - RAF pay ceases, pension starts. 1 wage, 1 pension.

    Prior to starting with my new employer I contacted my existing tax office (Cardiff) by telephone and my new tax office to inform them of the change in circumstances. When I started with my new employer I completed the necessary paperwork for payroll and subsequently forwarded my P45 once it arrived.

    I sat back, concentrating on my new career and assumed that because I had made both tax offices aware and done the relevant paperwork that all was in order. I received several PAYE notices during the four year period mentioning that I needed to adjust my personal allowance downwards to enable adjustment of an underpayment in Income Tax and my Payroll Office adjusted accordingly. I did not at any time receive a P800 during this period. So as far as I was concerned, the Tax Office had recognized the underpayment and were adjusting my Tac Code accordingly.

    All has been quiet until last week when the three P800's arrived. I have to say that in all honesty I was totally unaware of the problem mounting up as my PAYE codings were meant to adjust any underpayment (as directed by HMRC). I had made efforts at the beginning of this new chapter of my life to ensure the tax office was made aware of my situation. As they are supposed to be the experts I assumed they would get it right. I have reviewed their figures and it would seem that they failed to take enough tax from my joint income during those years but surely that was not my fault?

    I am putting together Letter 1 but is there anything I should not state or state additionally?

    Thanks in advance.

    Posted: Mar 1, 2011 By: nbeedham Member since: Mar 1, 2011
  5. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

    13,268 2,882
    No - keep to the text of the letter. We do have good results with this approach.

    Less is best with HMRC :)
    Posted: Mar 2, 2011 By: [email protected] Member since: Nov 4, 2005
  6. nbeedham

    nbeedham UKBF Newcomer Free Member

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    Thanks, letter 1 posted today, I'll let you know the outcome.
    Nigel Beedham
    Posted: Mar 2, 2011 By: nbeedham Member since: Mar 1, 2011
  7. Nelson01

    Nelson01 UKBF Newcomer Free Member

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    Thanks a lot for explaining the whole procedure this will surely help everyone.
    Posted: Aug 19, 2011 By: Nelson01 Member since: Apr 11, 2011
  8. chuckiejam

    chuckiejam UKBF Newcomer Free Member

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    I have received P800 forms with tax calculation for the tax years 2008/2009, 2009/2010, 2010/2011 suggesting that I have underpaid tax for the relevant years.

    During these years, I was employed within the NHS but worked in 4 different trusts. I had a main employer, but did contract work with the others in order to reduce their waiting lists. All the additional trusts were aware of me working for my main employer and I thought that all the tax I had to pay was deducted under PAYE. Shouldn’t my employers have applied the correct code?

    I wrote to HMRC requesting that under ESC A19 that the underpayment should be remitted but they have now written back to say that ESC A19 does not apply in my case because they did not know about all the sources of income I was in receipt of. Wouldn’t they be aware of this over the years from returns from the relevant employers?

    The requested sum has accumulated over the years and is substantial. I would value opinions on how to proceed.

    The tax system in this country is relatively new to me.
    Posted: May 18, 2012 By: chuckiejam Member since: May 18, 2012
  9. markchris

    markchris UKBF Newcomer Free Member

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    Thanks for your information
    Posted: Dec 7, 2013 By: markchris Member since: Oct 24, 2013
  10. victoredwards

    victoredwards UKBF Newcomer Free Member

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    You should always check your taxes. HMRC will work outwhether they think you’ve:

    • paid the right tax (in which case, you won’t hear from them)

    • paid too much (and are due a refund)

    • not paid enough
    Posted: Feb 27, 2014 By: victoredwards Member since: Feb 27, 2014
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