Tax underpayments

[Bulletguy]

You went to work.

You did your job.

You did as you were told.

You paid your insurance contributions.

You paid your taxes.

You paid your way..............or so you thought?

 

But it seems HMRC cocked it all up, got their sums wrong, and didn't charge 1.5 million people enough tax. *-)

 

So now they want it back.

 

But now for the good news! Four times that amount have actually been OVERCHARGED and are in line for a tax rebate.

 

Does ANYONE working with HMRC actually KNOW what they are doing???

Do they know their left from right??? *-)

 

http://www.guardian.co.uk/money/2010/sep/04/tax-errors-hit-6-million

 

 

[flicka]

Did you expect anything less, Bulletman.

They are ONLY Civil Servants, they have to think about amassing a mammoth pension, not what they should actually be doing.

>:-( >:-(

[Guest Tracker]

It is every individual taxpayers own responsibilty to check their own tax coding and tax paid and if this is not within their grasp then there are plenty of advisers who will do it for you - for a fee.

 

Which used to do a step by step guide to getting it right every year and there is plenty of info on the web?

 

It is very simple to set up a small Excel spread sheet to do the maths for you - all you need to know is the tax free allowance, the tax rates and bands and your income?

 

I have always checked my own tax code and total paid every year and there have been many incorrect years.

 

However, over the years I have had far more back from the very nice taxman than ever I have had to pay extra to him so I have no complaints - even though it should never have happened if the staff had the first idea about doing the job properly first time.

 

Last tax year I underpaid £100 and I have no problem with that as it was me who discovered it and told the tax man - and when he asks for it at the end of the year I'll send him a cheque!

 

It really is no big deal?

 

 

[Bulletguy]

Tracker - 2010-09-05 2:46 PM

 

It is every individual taxpayers own responsibilty to check their own tax coding and tax paid.....

 

It really is no big deal?

It's not the employee at fault though. The error is openly admitted by the HMRC who were not checking tax codes properly. People expect their employer and the HMRC to KNOW what they are doing.....after all both get paid in some cases quite substantial salaries to administrate. Obviously they aren't up to the job.

 

"Around 1.4 million people will be told they owe an average of £1,400 because of errors in HM Revenue and Customs' calculations of the pay as you earn (PAYE) tax system over the past two years.

 

The errors were identified by a new computer system that found widespread underpayments by employers through the PAYE system, which total about £2bn."

 

[Guest Tracker]

Perhaps if we were less obsessed with witch hunts and finding someone to blame in this country and more inclined to find fair to all solutions the whole country would be a far happier place in which to live?

 

Perhaps if everyone took responsibility for their own actions and financial affairs there would be less misery - and more happy accountants and advisers?

 

Mistakes happen - let he who is without error cast the first aspersions!

 

Let us start by making the media fully culpable for the harm done by their sensationalising of untruths and rumours. They have far too much money for anyone but the super rich to challenge them and that alone is a distortion leading to many a travesty of justice in my view?

 

That'd sure not be me!

[BGD]

"People expect their employer and the HMRC to KNOW what they are doing.....after all both get paid in some cases quite substantial salaries to administrate. Obviously they aren't up to the job."

 

 

 

 

Soz, BG, not true.

 

Employers are totally up to the job.

 

A persons PAYE tax coding is NOTHING to do with their employer. The employer has no say in it whatsoever.

 

The employer only applies the PAYE coding that they are told to by HMRC.

 

That PAYE code is between the employee and HMRC.....so don't blame the employer. It is for the EMPLOYEE to check that they have been allocated the correct coding.

 

 

[Usinmyknaus]

The Telegraph this morning informs us that "Tolley's Tax Guide" is the authoritative user's manual for UK tax legislation, and tops out at at a bedtime-reading friendly 11,520 pages long (up from 4,998 when Gordon brown arrived at the Treasury in 1997). Simples, eh?

 

Clearly, your average Brit has no excuse for not knowing the system better than HMRC..... *-) :-)

[CliveH]

Bruce is correct - your employer has no say whatsoever in your tax code, but they do contribute info to HMR&C that allows The Revenue to work out what your tax code should be. Things like your P11D document provide additional input that gets added onto your basic allowances.

 

The number of times we have come across mistakes by HMR&C is staggering.

 

One example – an NHS employee worked at two hospitals and paid two lots of NIC’s for years. She had no idea that this was not what should have happened and with our help successfully claimed back several £’thousands.

 

Other examples have been the wrong tax band being applied because the revenue misunderstood its own rules re P11D benefits on Company Cars and Company Private healthcare benefit.

 

I could go on.

 

It is relatively straightforward to work out what your tax code should be. It really is not rocket science.

 

However, as Tracker says _

 

"It is every individual taxpayers own responsibility to check their own tax coding and tax paid and if this is not within their grasp then there are plenty of advisers who will do it for you - for a fee. "

 

However, we do it as a service for our clients for free as part of their normal reviews.

 

 

 

[CliveH]

 

Hi Robert

 

You say - In all good humour I am sure!:-

 

"The Telegraph this morning informs us that "Tolley's Tax Guide" is the authoritative user's manual for UK tax legislation, and tops out at at a bedtime-reading friendly 11,520 pages long (up from 4,998 when Gordon brown arrived at the Treasury in 1997). Simples, eh?"

 

Much of Tolley's is complex stuff re ALL, taxes (IHT, CGT, Corporation as well as income and covers ALL eventualities) and to be fair - there are some amazing tax quirks in there. BUT! - Personal Income tax is not that difficult.

 

But they still manage to cock-up - and I think the reason is that in the complex areas - the data has usually been checked by an Accountant/Adviser etc. and the individuals in the Revenue dealing with these more complex areas do know what they are doing.

 

However, the run of the mill stuff gets (in my view) run of the mill individuals dealing with the data. And this is where the mistakes come.

 

Another example - Some time ago, a Pharmacist client of mine in the NHS also worked in retail shops occasionally - (they like doing this as it keeps their "hand in" with retail as opposed to hospital dispensing) and quite correctly, he was a member of the NHS Pension Scheme as well as pensioning his Private Practice income via a personal pension.

 

A chap in his local tax office saw that he was a member of the NHSPS and also had a Personal Pension Plan. he then totally misinterpreted the rules and tried to force the Pharmacist to accept a fine!!!! - AND the Pension Provider to pay all the contributions back and the Tax relief claimed on the contributions back to the Inland Revenue.

 

Even when we explained "two different employments" - this particular Taxchap was having none of it, writing back quoting revenue rules that you could not be a member of an occupational scheme and be a member of a Personal pension scheme. Which is true FOR THE SAME EMPLOYMENT!

 

Believe it or not, we had to go to the regions Tax Inspector who wrote to us and the client apologising for the mistake and indicating that the person who made the mistake was "new" and that they are now up for retraining with a particular reference on referring to more senior colleagues when out of their depth.

 

And so to summarise - I think too many HMR&C employees are able to make decisions on peoples taxcoding from a very shaky knowledge of even the basics!!

 

That is how this latest debacle came about.

 

 

[Guest Tracker]

"And so to summarise - I think too many HMR&C employees are able to make decisions on peoples taxcoding from a very shaky knowledge of even the basics!"

 

 

That's pretty much how I see it because when I have challenged some spurious tax codings and demands in recent years I have twice been told that the operative ' was unsure but will check with a higher authority and get back to me' and when they did get back it was to back down and agree my figures!

 

Should be Simples !

[Usinmyknaus]

Hi Clive,

 

Yes, could not resist it.

 

Bob (lol)

[Guest pelmetman]

Glad I only employ "er in doors", and I don't pay her enough to have to pay tax or stamp (lol) (lol)

[Bulletguy]

BGD - 2010-09-06 12:37 PM

Soz, BG, not true.

 

The employer only applies the PAYE coding that they are told to by HMRC.

 

That PAYE code is between the employee and HMRC.....so don't blame the employer.

 

Thats just got rid of a few thousand expensive 'bums on seats' then! (lol)

[Bulletguy]

CliveH - 2010-09-06 3:47 PM

 

The number of times we have come across mistakes by HMR&C is staggering.

 

CliveH - 2010-09-06 4:09 PM

 

However, the run of the mill stuff gets (in my view) run of the mill individuals dealing with the data. And this is where the mistakes come.

 

And so to summarise - I think too many HMR&C employees are able to make decisions on peoples taxcoding from a very shaky knowledge of even the basics!!

 

Which in short means they aren't up to the job? What I originally said but without dressing it up.

[Mel B]

My brother is a tax man .... :-S

 

The massive staff cuts that have been made in the past, meaning the work of many has been combined to be looked after by a handful of staff, is ultimately a major part of the problem, there simply isn't enough time it the day for staff to 'properly' check every account and I can't even repeat his comments on the 'computer system'! I'm not disputing that there are some staff that are inexperienced which also cause problem, but this isn't the major problem.

 

He's due to retire shortly and can't wait to get out of there, he's not well with some health issues, and could easily have gone on long term sick leave, but he's too loyal and feels guilty taking even a single day off. If it wasn't for people like him the place would have ground to a halt long ago.