Tax question

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Tax question

Post by thekungfury @ Fri Mar 04, 2011 5:29 pm

I was provided with a company car in September 2009. I got a PAYE coding notice in October which I assumed (I know, I know) was to do with the new tax I'd be paying on my car.

Roll forward to April 2010 and I'm given my P11D by my employer and it doesn't show the car as BIK because my employer hadn't informed HMRC via the P46. I immediately contacted HMRC and gave them the car value, the CO2 value and the exact date the car was available from so that they could tax me correctly for the underpayment. The person I spoke to told me that they would add the underpayment to the next tax year. I took this to mean the 2010-11 tax year and I received a new PAYE coding notice a few days later.

Roll forward further still to March 2011 and today I've just received a P800 form saying there's an underpayment for the 2009-10 tax year and it'll be added to the 2011-12 tax year. Since I was led to believe I had been paying this during 2010-11 I haven't made any provisions for this extra tax. If I'd known I would have been saving.

With the P800 there are some notes and a section which reads:
If we had already received all the information needed to calculate your tax liability but have failed to act on it promptly call this number

I've called the number and they say informed in April, acted in February is "prompt". I disagree and I'm appealing.

Has anyone experienced this before? Do I have a cat in hell's chance of succeeding?
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Re: Tax question

Post by 75_Steve @ Fri Mar 04, 2011 5:31 pm

Haven't had this specific issue, but I do know that they'll win any appeal and will always get their money.
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Re: Tax question

Post by dirtyboy @ Fri Mar 04, 2011 5:38 pm

TKF wrote:Do I have a cat in hell's chance of succeeding?


To answer the question, your tax is due, no chance of getting out of it, however, the time to pay back/interest charges are what you now need to deal with.

First phone someone at HMRC, get their full name.

Then ask them for dates they've recorded any phone calls/noted your file, and whether they correspond with your call in April. If that's on their file, fine, appeal, however, the tax IS due, and there's no way around it. Your best hope is for a protracted arrangement either via your coding or via another arrangement (direct debit / standing order) and hope they don't charge interest due to them not updating your file correctly after being informed.

If they don't have your phone call on record, or a note on the file, then you'll <ahem> need to produce a copy the letter that you sent them on that date, you remember that letter detailing the new car you had received?

Complain either way, HMRC are a shower of shite at the moment.
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Re: Tax question

Post by WD40 @ Fri Mar 04, 2011 5:44 pm

75_Steve wrote:Haven't had this specific issue, but I do know that they'll win any appeal and will always get their money.


Apart from an appeal I made last year, that ended up dating back to a series of BIK fcuk-ups on the part of my employer. I got a cheque back for nearly £1k, which was rather nice.

Payroll accountants are just as susceptible to human error as anyone else. I was just glad I have kept every single payslip I have ever had at that point. It was arduous and took months to resolve; but if you're right and can show it, then they will and do cough up (admittedly much less readily than they send demands).
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Re: Tax question

Post by thekungfury @ Fri Mar 04, 2011 7:34 pm

dirty boy wrote:To answer the question, your tax is due, no chance of getting out of it, however, the time to pay back/interest charges are what you now need to deal with.

They aren't adding any interest and I've been able to confirm they have calculated the right year/BIK/% numbers. They've also offered to let me pay over 2-3yrs if I really want (which I don't).

However my beef is I told them on 14th April 2010 (they confirmed the call date) but didn't take any action until 6the Feb 2011. In their own documentation it says if they don't act promptly then I could be due a refund.

Furthermore the lady I spoke to in April said "You'll pay the overpayment in the next tax year" which I understood as "You'll pay the overpayment in this next tax year".

Therefore I thought I was done and dusted.
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Re: Tax question

Post by Dirk @ Fri Mar 04, 2011 7:47 pm

So you agree you owe the money.
Think HMRC should have taken it earlier
But HMRC aren't charging interest
So you think that HMRC should have taken the money earlier, meaning you could not have earned interest in the meantime and so you would have been worse off.

You are complaining that HMRC didn't do something in a way that would have left you worse off?
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Re: Tax question

Post by mimi @ Fri Mar 04, 2011 7:49 pm

TKF wrote:
Furthermore the lady I spoke to in April said "You'll pay the overpayment in the next tax year" which I understood as "You'll pay the overpayment in this next tax year".

Therefore I thought I was done and dusted.


you spoke to her in April and she told you you'd pay the next tax year, and you thought that meant then?
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Re: Tax question

Post by WD40 @ Fri Mar 04, 2011 7:55 pm

stormy teacup wrote:
TKF wrote:
Furthermore the lady I spoke to in April said "You'll pay the overpayment in the next tax year" which I understood as "You'll pay the overpayment in this next tax year".

Therefore I thought I was done and dusted.


you spoke to her in April and she told you you'd pay the next tax year, and you thought that meant then?


I would have made the same assumption TKF did if those were her words. It's the presence of "this" and "next" together that provide the element of doubt I think.

In -

"this" tax year = the one we're currently in. (so on 14th Apr 2010, 2010/11)
the "next" tax year = the one after the one we're currently in (likewise, 2011/12)

"this next" leaves room for doubt in my mind.

I can't call Apr-Feb "prompt" either. Would they consider it equally "prompt" payment of an outstanding tax bill if you settled it 10 months later? Or would the bailiffs have already paid a visit by then?
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Re: Tax question

Post by mimi @ Fri Mar 04, 2011 8:01 pm

WD40 wrote:
stormy teacup wrote:
TKF wrote:
Furthermore the lady I spoke to in April said "You'll pay the overpayment in the next tax year" which I understood as "You'll pay the overpayment in this next tax year".

Therefore I thought I was done and dusted.


you spoke to her in April and she told you you'd pay the next tax year, and you thought that meant then?


I would have made the same assumption TKF did if those were her words. It's the presence of "this" and "next" together that provide the element of doubt I think.

In -

"this" tax year = the one we're currently in. (so on 14th Apr 2010, 2010/11)
the "next" tax year = the one after the one we're currently in (likewise, 2011/12)

"this next" leaves room for doubt in my mind.

I can't call Apr-Feb "prompt" either. Would they consider it equally "prompt" payment of an outstanding tax bill if you settled it 10 months later? Or would the bailiffs have already paid a visit by then?

that is what I meant, I'd have queried her words there and then. also, if the call was in April then surely it was too late to pay in that current year? plus there is no "this" and "next" together in what she said.

I don't call that prompt, no. but as Arthus has pointed out, it appears TKF is better off.
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Re: Tax question

Post by thekungfury @ Fri Mar 04, 2011 8:11 pm

How much interest would you get from £1200 over the course of 18mths? Enough for a fun size Mars Bar?

I am doing something this year that could do with having that grand, that's why I'm trying to pursue the HMRC's own loophole.

Put another way, imagine you'd been caught speeding in April 2010 and sent back the NIP within 2 days happy *cough* to pay the fine. If they then sent you the fine in March 2011 along with an FAQ that said "If we haven't processed this fine promptly please call this number". What would you do?

Worst case is I pay the tax. Best case is they listen to my appeal.
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Re: Tax question

Post by thekungfury @ Fri Mar 04, 2011 8:13 pm

stormy teacup wrote:
you spoke to her in April and she told you you'd pay the next tax year, and you thought that meant then?

If I told you I was going to buy a car in the next year, what would you take that to mean?
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Re: Tax question

Post by mimi @ Fri Mar 04, 2011 8:17 pm

TKF wrote:How much interest would you get from £1200 over the course of 18mths? Enough for a fun size Mars Bar?

I'd think enough for one of those big share bags of something equally sugary.

seriously though, I wasn't rubbing it in. and I think they're bastards for leaving it that long. they should accept your appeal.

if you told me you were going to buy a car next year, I'd accept it as a chat.
but in this case, what I was pointing out is a cut-off date. sorry but again you can't take anything these people say without querying it.

edited to say that in the next year to me means 2012.
Last edited by mimi on Fri Mar 04, 2011 8:18 pm, edited 1 time in total.
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Re: Tax question

Post by thekungfury @ Fri Mar 04, 2011 8:26 pm

stormy teacup wrote:sorry but again you can't take anything these people say without querying it.

As I'm learning...
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Tax question

Post by Woolly Pullover @ Fri Mar 04, 2011 11:06 pm

My company sent them all the p11d stuff as normal in may/june, and it has taken the lazy useless feckers until January to bother doing anything. Now they're clawing back underpayment from 09/10 in the last two months of 10/11. I'm £200 a month down for the last two pay days thanks to this. Ok, so I did owe £400 for last year but I didn't know this until they wrote to me, and if they had done it in the summer (as they always have in the past), I'd have spread the repayment over about 8months, slightly easier to do!!
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Re: Tax question

Post by thekungfury @ Sat Mar 05, 2011 9:10 am

Woolly Pullover wrote:My company sent them all the p11d stuff as normal in may/june, and it has taken the lazy useless feckers until January to bother doing anything. Now they're clawing back underpayment from 09/10 in the last two months of 10/11. I'm £200 a month down for the last two pay days thanks to this. Ok, so I did owe £400 for last year but I didn't know this until they wrote to me, and if they had done it in the summer (as they always have in the past), I'd have spread the repayment over about 8months, slightly easier to do!!

Very interesting. I was told categorically yesterday that HMRC couldn't collect underpayments in a period less than 52 weeks.

Therefore when I called them on 14th April the new year had started and they could begin collecting.
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Tax question

Post by Frik @ Sat Mar 05, 2011 9:16 am

Hmm, having just taken on a company car this is all rather interesting. What's the best way to let HMRC know I'm now receiving this BIK.

I'm struggling to call them bastards atm as I randomly received a cheque from them this week completely unannounced, apparently for the tax year 05/06. Which was nice.
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Re: Tax question

Post by thekungfury @ Sat Mar 05, 2011 10:32 am

Frik wrote:Hmm, having just taken on a company car this is all rather interesting. What's the best way to let HMRC know I'm now receiving this BIK.

What should happen is within the 28days of the end of the qtr you received the car your employer must send a P46 form to HMRC. Shortly afterwards you'll receive a new PAYE coding notice (assuming you're on PAYE).

If they haven't they could be liable for a fine and you could be facing an underpayment.

I would call HMRC and check if it's been done or not. You'll need your NI, the car's P11D value and CO2 figure.
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Tax question

Post by Frik @ Sat Mar 05, 2011 1:07 pm

Cheers Tk, will do.
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Re: Tax question

Post by tanglerat @ Wed Jan 11, 2012 1:22 pm

Handy though, lets us ask teeks how he got on with his appeal.
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Re: Tax question

Post by thekungfury @ Wed Jan 11, 2012 1:30 pm

The rejected it.

But guess what? They then didn't take the underpayment in the 2011/12 tax year as they had previously advised.

So I'm appealing again.
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