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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 16422
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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This could be complex! No. I was previously employed through

Customer Question

Hi Sam. This could be complex!
JA: Have you talked to a tax professional about this?
Customer: No.
JA: Is there anything else the Accountant should know before I connect you? Rest assured that they'll be able to help you.
Customer: I was previously employed through my own limited company, but this has been dormant since 5th April this year (not trading). Since then I have a been a permanent employee being taxed at source. My estimated income on my Personal tax account is £45k over what the actual figure will be, and my tax code is wrong as a result! I'm also payig a monthly DD to clear underpaid PAYE, but this is not being accounted for on my tax account by the looks of things. There is also an non-coded income figure of over £35k on my account - which I do not understand.
JA: Which tax year is this for?
Customer: Current
Submitted: 17 days ago.
Category: Tax
Expert:  Sam replied 17 days ago.

Hi

Thanks for asking for me

Just a little additional information please

Why were you trading through your own limited company before and are not now - what has changed

Who are employing you from 06/04/2021

What estimated income and what personal tax account?

What outstanding PAYE do you owe and what tax year does that relate to and when did you agree to the DD?

The £35000 non coded figure - what account ?
Do you think a phone all would help - it does attract an additional £44 charge but might be easier, if thats how you would like to proceed then please do fill in the pop up offer

Thanks

Sam

Customer: replied 17 days ago.
Hi Sam,I was a contractor previously, and needed a limited company as a PSC. IR35 changes effectively ruined 23 years of doing that, so I originally operated under an umbrella company for the same client between 5th April, and 2nd July 2021 and was PAYE (JSA services for Jaguar Landrover) before leaving Jaguar Landrover and seeking permanent employment. I am employed by Arrival Ltd (since mid July) on a salary of £70k. I suspect the £35k non-coded income assumes I will still be taking income from my LTD co. The income estimate on the gov.uk/personal-tax-account for the current year is £117k! My estimate is £66,696! The £35k non coded figure is on my PAYE account. The income figure for Arrival is incorrect, the non-coded figure is a mystery, there is no account for my direct debit to clear the unpaid tax (so it is still adding the unpaid tax to my burden), and the estimated income is complete fantasy which does not tally with any of the HMRC's (already incorrect) figures on the my PAYE account summary page. It's a complete mess, with the net result that my tax code is now K224X and it's utterly stifling!
Expert:  Sam replied 17 days ago.

Hi

No I am sorry but I have to beg to differ

IR35 always existed you were engaged using the legislation illegally and the reminder to all persons involved rectified the situation

You should now be paying less as before you had no ho holidays or sick pay and were paying both the employers National Insurance and the employers and this should have bene paid by Jaguar as they should have employed you as you were not genuinely self employed at any time

That aside lets deal with the position you now face

Why would you still take money from the limited company ? What purpose does it serve ?

Ask HMRC to amend the estimate income from the £117K to £66K but when you add that to the £35K you say you will continue to receive from the limited company that should in fact be £101K (if not then tell them to amend this to the £66K

You originally stated that you are also paying a monthly DD to clear underpaid PAYE but have nor provided any details please advise further

Thanks

Sam

Customer: replied 17 days ago.
No Sam. Regarding IR35, I never acted illegally - that is a ridiculous and libellous accusation! The HMRC's own CEST tool resulted in an "outside IR35" determination in my case. JLR would only engage contractors inside IR35, so I ceased my engagement with them as soon as was practicable. I need not prove to you that actually I was indeed self employed for 23 years!!!I will take my enquiry elsewhere....Thanks for your time.
Expert:  Sam replied 17 days ago.

Hi

Its not for me to say whether you acted illegally or not bit the IR35 legislation is not new its just been misused for years so if you were outside you should never have taken up the umbrella company in the first place

If you would rather me not be honest then please do seek advise elsewhere or I,m happy to opt out and let someone else help you here if you would like but the fact is your attitude is that HMRC messed with me and its their fault when in fact it isnt - and for you to hold onto that beleif is not helping you manage the situation you seek help on - Im sure you can appreciate that

Thanks

Sam