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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15979
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I received aletter from HM Revenue & Customs 5th Feb 2013,

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I received aletter from HM Revenue & Customs 5th Feb 2013, saying I owed £609-80 for 2011/12, I wrote back demanding further infor and received aletter saying no tax due for 2011/12, with a £9.00p refund.
On 28th Jan 2014 I received a letter saying tax was underpaid for for 2010/11 of £852-60 and a further letter saying tax underpaid for 2010/11 of £368-80 -also on the same date a further letter saying that tax underpaid was £843-60 for 2011/12.
Afurther letter on 30 Jan 2014 stating tax was underpaid £843-60 to April 2013.
I wrote back saying I retired from work in 2011 - so how was it that I owed that ammount.
A further letter on 6th feb 2014 stating I owed tax of £368.80 for 2010/11 because Essex County Council and another firm that I worked p/t for a few months both used tax codes which gave me the full personal tax allowance, hence was paid twice. Also agreed that their tax calculation on 30 Jan was incorrect and has been cancelled.
I feel that it is my employers fault, also due to the hmrc incompetence that this has not been resolved earlier.who gave the wrong tax code in the first place. I am retired on a pension and unable to pay that ammount unless monthly payment of £10 per week -As it is 4 years since this happened can I refuse to pay.
S. Collins

Can you confirm whether you are in receipt of a state pension and a pension from Essex County Council and, if so, when the state pension started please. When in 2011 did you retire from Essex County Council? As of now, are the tax office saying that you owe tax for 2010/11 and 2011/12 and not 2012/13? Was it only in the 2010/11 tax year that you did a part-time job at the same time as receiving your pension?
Customer: replied 4 years ago.

I retired from my permanent job for Essex CC when I was 60, July 2006.Since that date I have received a state pension and a pension from Essex C.C.

The tax office recent letter says I owe tax for year ended 2010/11 only - during that time I was working p/time for Rebuild and on my P60 2011-12 and P45 earnings were £2480 - tax £9.00 final tax code 747L My leaving date 6.6.11.

My Essex CC pension tax code on P60 for year 2010 is 58L and I paid £106,60 tax the following year paid £ 126,80 tax code 48L.

My irritation with the Tax is the many letters with different demands and the length of time it has taken to sort out my affairs.




Leave this with me while I draft my answer. There is a fair amount to type so please bear with me.
Hi again.

Shortly before you were due to start receiving your state pension, you should have received a P161 to complete and send back to the tax office to help them ensure that the correct amount of tax was deducted from your ECC pension and that your tax code took into account your state pension which is paid gross but is taxable.

When you started the part-time job, the employer should have asked you to complete a P46 in which you would have confirmed you were in receipt of your ECC pension. The employer would then have submitted that to the tax office for coding instructions. That doesn't appear to have happened. HMRC would have picked up your ECC pension from your NI number on the P46 and issued an appropriate tax code, probably BR (basic rate tax deduction - 20%).

The law states that a taxpayer is responsible for ensuring that their own tax affairs are in order and the tax office have to accept that it was reasonable for them to believe that they were in order for them to be absolved of any responsibility for an underpayment of tax accruing, leaving an employer, a pension payer or HMRC to carry the can. I always tell people who take on a second job to call the tax office themselves to have their tax coding(s) looked at in the light of a second PAYE source rather than trust others to do it.

The first thing you need to do is to satisfy yourself that the tax office P800 calculations of the underpayment(s) is/are correct. If they are, you should write to the tax office and ask them to review your case, give you an explanation as to why you are underpaid and to write off the tax owing under Extra Statutory Concession A19 which they should do if they did not use information supplied to them that should have enabled them to get your taxes correct within the time limit set out in ESC A19.

Take a look here for information on ESC A19 and on employer error and ask the tax office to look into your part-time employer's actions when they took you on. Also refer to the number of letters you have had, all giving you different figures. If you have not had P800 tax calculations, call the tax office and ask for them so that you can check the figures. There are some more useful notes here.

If the tax office maintain they weren't responsible for the underpayments after reviewing your case, you should ask for a second review by another tax officer. After that, if you need to, you can make a complaint to The Adjudicator's Office and then to The Parliamentary Ombudsman.

I'm afraid the process I've outlined above is the one you to follow to have any chance of having the tax owing written off. There is no other way to deal with the situation you find yourself in.

If you do have to pay the tax you can negotiate with the tax office to pay it over a period of time.

I hope this helps but let me know if you have any further questions.
I have to go out for a while but I will be back to answer any further questions you may have.
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