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Underpaid tax paid twice?

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linros | 20:36 Thu 19th Mar 2009 | Business & Finance
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Hi
I'm very confused and hope someone can help. My tax code for 07/08 included an amount for underpaid tax so presumably I paid it off through PAYE because it doesn't show on my 08/09 code. Then I had to do a self assessment tax return for 07/08 and they want to charge me the underpaid tax again - it's been added to my income tax due. Surely I will be paying it twice? Or am I missing the point?
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Your tax code for 07/08 would only be adjusted if you owed tax (through underpayment) from a previous year. It seems that, although you repaid that outstanding bill, HMRC are now saying that you also underpaid tax on your earnings for the actual 07/08 tax year.

Chris
the underpayment has to be added to your total tax due for 07/08, otherwise when your tax due figure is compared to tax deducted, it would look like you had paid too much tax under PAYE for the year. So yes, you have already paid it, this is just to balance the books.

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