I don't understand an answer from HMRC PAYE calculator...

[Tom McClelland]

I'm checking a query someone has raised with us, and I'm getting the following result from the HMRC calculator... Is it just me, or has that calculator not just failed to calculate 40% of the cumulative earnings? This is a really simple where you don't have to calculate free pay or earnings bands or anything, so I think I'm going mad, because surely the HMRC calculator can't be getting it wrong?

http://payecalculator.hmrc.gov.uk/PAYE0.aspx


PAYE Tax Calculator

Glossary

Values Entered

Employee tax code: D0
Period of pay: Weekly
Is it on a week 1 basis: No
Pay this week: £548.94
Previous total gross pay to date: £23,609.11
Previous total tax due to date: £9,193.00

Payment Date: 28/01/2011
Results

Week Number 0
Total pay to date (column 3 of P11) £24,158.05
Pay adjustment (column 4a of P11) £0.00
Total taxable pay (column 5 of P11) £548.94
Total tax due to date (column 6 of P11) £9,412.20
Total tax due this period (column 7 of P11) £219.20

 

[Tom McClelland]

I've just worked it out. It is applying D0 on a W1 basis, even though I said "No" to that.

D0 isn't universally W1, because the test data that we get from HMRC specifically tests both D0 and D0/W1 tests. So this looks like a simple bug in HMRC's calculator.

 

[David Richards]

Back of fag packet calculation...

I make it that it should be be deducting £470.20, as total tax due is £9663.20. What it's doing is deducting a straight 40% from week 43's pay, rather than looking at the total pay to date.

It looks like they've forgotten that D0 is no longer implicitly a W1/M1 tax code... it changed at the start of this tax year.

But then, as you and I both know, the HMRC PAYE calculator doesn't go through the same accreditation process as the payroll software we supply. Software calculating that amount of tax would fail accreditation.

 

[Tom McClelland]

There's a relief. I'm not going mad then. (or if I am it isn't destroying my ability to do simple calculations).

It doesn't solve the fact that I have a client complaining to me that, "12Pay is getting its D0 calculations wrong". After all, how could HMRC's calculator have any errors in it?

Won't everything be wonderful, once HMRC have taken full charge of PAYE and NI calculations.

 

[wizzard]

There's a relief. I'm not going mad then. (or if I am it isn't destroying my ability to do simple calculations).

It doesn't solve the fact that I have a client complaining to me that, "12Pay is getting its D0 calculations wrong". After all, how could HMRC's calculator have any errors in it?

Won't everything be wonderful, once HMRC have taken full charge of PAYE and NI calculations.

Oh yes knees up and brewery spring to mind (clean version )

 

[David Richards]

There's a relief. I'm not going mad then. (or if I am it isn't destroying my ability to do simple calculations).

No definitely not, I even checked it our payroll software afterwards and got the same result.

It doesn't solve the fact that I have a client complaining to me that, "12Pay is getting its D0 calculations wrong". After all, how could HMRC's calculator have any errors in it?

Been there too, it's a tough one. Even showing them the working out doesn't always convince them!

I don't know if it will help to say you've even had the calculation checked in a competitor's payroll - and that it agrees with your program. Becasue there's not much else that can be done in that situation.