tax arrears

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Ankou | 17:15 Tue 03rd Jan 2012 | Business & Finance
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two days before the new year i received tax details from 2008/09, 2009/10 and 2010/11 which altogethrr identified i owe around £12,500 in tax.

am i just another statistic in this monumental cock up? i have not changed job or circumstances since about 2001 so it seems that somebody somewhere allocated me an incorrect tax code in 2008 with me unawares.

what is one to do ?


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Did you have anything which didn't go thorugh payroll lsuch as a company car?
Or did you have a second job?
It seems a lot.
What code did you have from 2008?
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Question Author
yes i know helen, but as i said my circumstances haven't changed so i wouldn't expect my code to be wrong. and what average person really knows their proper code ?

factor, no extras and no co. car, just one full time job.
Ouch! Hope you get it sorted.
Contact the tax man for a check that he has indeed got the coding right.

If it is correct, then approach them for a spread repayment with what you are comfortable with - it is better to keep it a minimum level that you are comfortable with and then pay any windfall towards it than going up and down on them - gives you a little extra flexibility too.

They will be sympathetic as there are several thousand in the same boat, all because of their cock-up......
Thanks Ankou. So can you tell us what your code was?
Question Author
so it seems dt.

the latest year 2010/11 says it will be spread, but the other two it says nothing, so i hope it is not expetced to be a one off by march. i will be consulting a tax adviser, just wanted to air my pain.

in any event, like everyone else this will cripple our finances altogether even if spread. nto a great start to 2012.
Question Author
factor not sure as i don't have the details with me but i think it was just the standard 647l.........?
Good idea, they can also check your tax position and advise accordingly - and help in getting any liability spread.
You could try using the form ESC A19 to appeal - start your search here:
You should be able to find a template - sorry I do not have it to hand.
Just bear in mind that you are not a 'person' to HMRC (Her Majesty's Royal C**k Up'), but only a reference number, so keep the tone of any letters objective.
It is their error, but their defence is always that it is up to the individual to check his/her tax code. Their mistake, your fault.
From my experience, they blindside you with jargon and obfuscation and pursue you relentlessly until you give in from sheer war weariness.
You can come to a payment arrangement with them, or they may threaten you with having to do self-assessment returns in future.

However, if your name is Goodman Sachs or Vodaphone you can skip merrily away.
Question Author
thanks anne, i understand that if i had millions in the bank then i would be able to find a way to avoid paying it at all. alas, i am a mere minion.
They have details of all your income, and they're interested in getting theri money - they have 'a responsibility' to do so (ha).
If all else fails, you can come to a negotiated repayment agreement with them.
This can be spread over quite a long period, if memory serves me right.
ankou.. did your employer make the error and deduct the wrong amount? or are you self employed?
a friend of mine had a similar thing.. and at the same time i heard on LBC radio that you MUST challenge any demands for this 'underpayment' as so many mistakes are being made by I/Rev...
Read this interesting website.. it has template letters you could use!
If your employer made the mistake then apparently the I/Rev must chase them and not you
Question Author
that is possible nosha?
i am not self employed.
Ankou, use the template that is relevant for Employees who are on PAYE. The Telegraph also published a similar template. It cites Extra Statutory Concession A 19, and that it applies as you (IRS) failed to make proper use of the facts you had been given about my sources of income. It also suggests that you should state that payment of this tax would result in significant hardship to me whether as a direct payment or through an adjustment to my notice of coding next year. Then request that under the provisions of ESC A19 the whole of the underpayment shown on P800 should be remitted.

The template may still be on the DT website. If not, an e-mail to the editor might result in a copy being sent to you.
Challenge all the way and spread the appeal out - separate ESC A19s at separate times for each of the three years.
Something has just occurred to me - did they ever ask you to complete a personal tax assessment?
They try to use this as justification for their miscalculations.

You say just one job, not self-employed, no car etc. so your tax should be deducted correctly under PAYE - & if your code for 10-11 was 647L then I think it is the correct one. All of which means it is very difficult indeed to see how you could have underpaid such a large amount. Did HMRC send you any calculations of how they have worked the amount out? If so, are their figures for your income correct and do the figures they quote for both income and tax deducted agree with those on your P60 - which you get at the end of each tax year?

Make sure you check all the details you can, & when you see a tax adviser take full info. on your income & tax deducted with you.
I agree with themas. If your code was the standard one then it's hard to see how the deductions could have been so far out. You need to check through all their figures and maybe speak to your payroll manager

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