It seems as though someone I know has been under paying income tax. Employer has used incorrect tax code and now there is a ~9k tax bill to pay! Anyone know if HMRC allow re-payment over a period of time or do they demand it all instantly?
Also, assume it has to be sucked up that the employer didn't deduct sufficient tax?
They do it by correcting your tax code and collecting it over time, that'll still hurt though, even at emergency tax code that'll take a while!
You will be allowed time to pay.
Employer has responsibility to get it right, you have responsibility to check it is right too.
£9k? Are you Branson? 😉
£9k ! Over what period of time ?
Unless it was over a good number of years, you/they must have noticed surely ?
6k for year in question and estimated for current year - admittedly payable next year!
As I said, someone I know! I only wish I owed that much...
Any idea how long they allow and whether or not they apply interest?
Wish I could not notice an extra £500 a month in my pay packet.
Edit: In fact how can a tax code error make that much difference?
The person concerned isn't known for attention to detail. That might change now!
Jambo - for some reason the BR rate has been applied. It should have been noticed, it wasn't. Just seekign clarification on the impending implications of doom! It seems that time will be allowed - this is good! The interest element not understood yet.
BR rate is commonly applied when you change employment or you have a second employer. My missus had it applied for a year, but as a lowly paid social worker, she ended up with a rebate.
The person concerned isn't known for attention to detail. That might change now!
Well they won't notice the adjusted rate being clawed back then 😯