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Newsletter issue - July 2015.
HMRC has started the tax reconciliation process for the majority of taxpayers who are taxed under PAYE. This may include you or your relatives, as this reconciliation also covers those in receipt of the State Retirement Pension and private pensions.
If the HMRC computer system finds there is a difference between the tax collected under PAYE and the amount due for the tax year to 5 April 2015, it will issue a form P800 which includes a tax computation. Even if we are authorised to deal with HMRC on your behalf they won't send us a copy of the P800, so please forward a copy to us if you get one.
If you have overpaid tax for 2014/15 a cheque for the tax refund should arrive about two weeks after the form P800. You don't have to request that tax refund. However, before cashing the cheque from HMRC please compare the figures shown on the computation of tax on the P800 against your form P60 or payslips for 2014/15. We can help you with that.
Where the HMRC computer system thinks you have not paid enough tax for 2014/15 you will also receive a form P800, showing the amount of tax apparently now due for payment. It is even more important to check the calculation of any underpayment of tax. Common problems include:
- State Pension is an estimated figure, not the actual amount received;
- The value of benefits (e.g. company car or health insurance) are not as reported by your employer for 2014/15;
- The business expenses you claimed to be set against your income haven't been deducted.
All of those problems arise because of the timing of returns processed by HMRC, which is not necessarily in line with the programme to issue P800 forms.
Another major issue this year is the duplication of employment income, which leads to an apparent underpayment of tax. This can happen because PAYE records submitted by employers are double counted by the HMRC computer system. If the income on your P800 looks too high you need to contact HMRC to get it corrected, or we can do that on your behalf.
