Looking for some STW hive-mind expertise here…

I’m contracting but PAYE on a running contract as an employee of a recruitment company. Before that I was a permanent employee of an umbrella company and before that a perm employee of another company – no self-employment or ltd company or break in employment at any point.

I filled in my tax return for 11/12 last summer, got told I owed £1300, couldn’t understand why as I was PAYE the whole time, but paid it anyway as all the info I’d given them was correct. I have no second income, a few ISAs and a savings account – nothing complex at all.

A month or so ago, HMRC told me to file my tax return or get a fine for late payment so I rang them to tell them I’d done this months ago and had email proof to say they’d received it. They said ok, don’t worry.

Today I got a letter telling me to pay there was an error with my submission and I have to pay £1400 by 31st Jan (this year) or get a fine. I think this is totally unreasonable.

a) I think they’ve made a mistake – how can my tax be out by £2700 when I’m PAYE!
b) it’s utterly unreasonable to expect me to find £1400 in 2 weeks
c) it gives me no time to get an accountant or my employer(s) to look into it or to dispute it with HMRC…

Have I got any options in terms of getting them to back off on the deadline so I can raise a dispute/complaint and do a proper investigation myself…? I’d like to investigate if the £1300 was correct too – they appear to be pretty disorganised…

your starting off on the wrong foot here with HMRC.. 5 simple steps to an easy life..
no. 1 their right
no 2 your wrong
no 3 they want more money you give it
no. 4 your wrong
no 5 thier right

If it’s as straight-forward as you say and you have all the required back up to hand then any practicing accountant should be able to tell you what’s what in no time at all.

It’d be worth speaking to the HMRC about it though, they should be able to go through the calculation with you as well.

oh no they wont they listen make notes and write to you..

*KABOOM*

They’re
You’re
You’re
They’re

As you were.

Totalshell I’m worried that you’re right. Which is totally unreasonable… the point of a tax code and PAYE I thought, was to take my tax at source, not harass me for big chunks of cash months later…

“Their right” to do what, precisely?

Generally speaking, I’ve always found HMRC to be incorrect, so don’t worry too much – I shouldn’t imagine you’ll be required to pay all that tax back in one go.

Did you say umbrella company? Get an accountant and get your side checked then go back to them

Generally speaking, I’ve always found HMRC to be incorrect, so don’t worry too much

^this.
Three years haranging them to get £1.5k back after a PAYE error/issue.
In the same post as the cheque I get three letters telling me I was being investigated for tax for the previous three years. I owed 32p over those three years it transpired…
barstewards, and I would not trust them as far as I can kick them.
Get a (good) tax accountant asap, plus write to them now and state your position and intent.

PAYE works fine if you have been allocated the correct tax code.
What was yours in the periods of employment?
What should it have been?
This may help explain HMRC’s requests or strengthen your case for miscalculation of any alleged tax owing.

HMRC are rivalled only by the DVLA for incompetence.
I’d phone them and explain the situation. They generally allow payment plans as long as you’re not doing it every tax year. In the meantime, get some proper tax/accountancy advice to see exactly where you stand. Could be a tax code balls-up, in which case they may well be right despite you not personally being wrong.

I don’t even bother phoning. I’ve been told on the phone so many times “write to us to confirm” – just drop them a line.

I played a similar game with them about 10 years ago when I had (according to them) been self employed.

God knows where they got this from but as fast as I contacted them the faster the threatening letters came and the fine amount went up.

I worked out that the place was/is largely staffed by minimum wage keyboard monkeys who can’t deviate from a script and pretty much don’t give a 5hit so don’t take it personally. I eventually found someone with the brain cells that week and we got it sorted.

Above accountant advice is sound but it may be worth persisting with them on the phone to find someone who might make the effort to help.

On a connected note, who knows that you’re obligated to tell the tax man when you change address?

If you’ve been PAYE as an employee then you should have your payslips and your P whatever end of year form. With those it will take 5 mins to check and see if they are right.

Wife was all paid up regarding HMRC about 5yrs ago.
Next letter stated ~£4k was due.
About one month ago they finally sorted it out. (It was because they had entered an amount incorrectly, by a factor of 10). I had no paperwork that indicated what they had done.
My accountant was able to get different/better information that demonstrated this (from their systems). It still took about 4yrs to clear it up…(sorry, scratch that, it still took 4yrs for them to correct it in writing, still awaiting the refund cheque).

I think they’ve made a mistake – how can my tax be out by £2700 when I’m PAYE!

This is I’m afraid one of the bigges misconceptions that people have about the PAYE system. It does not follow that just because this is how your tax is calculated that it will be correct. There are many errors that could happen including HMRC giving the wrong tax code, your employer not applying the correct tax code (you can at least check this by comparing your payslip with the HMRC notification), your employer not giving the correct information to HMRC and doubtless many others.

I’ve been PAYE for my entire working life and this year I got a £6000 rebate from the tax man. Now granted this is less disruptive to me than a bill would be but it is still a sizable error. Not much help in your current position I know, but a salutory warning to us all.

I would suggest phoning them though as my experience is very different to those listed above. When my company was taken over in 2011 they came to the rather odd conclusions that I had been working for both the new and old company at the same time and was drawing two salaries so they adjusted my tax code to account for this. It took about 10 mins on the phone to sort it out.

Did you file on-line, if so then you will have got an assessment of tax due before filling.

If this was subsequently changed by HMRC then it should be straight forward for them to explain why. If you filed paper there is potential for incorrect data entry at their end, which may be harder to indentify, maybe its possible to get a full statement to check against your filing.

Given it is the sameish amount each year it sounds like a tax coding issue, or non-allowable deductions. Anyway, get on the phone and make them explain – then if not happy get some professional advice

And not to point out again but umbrella companies are not normally that straight forward. Either pay or get you affairs checked out. Go in person rather than calling make an appointment but you will stand better if you have had someone confirm your position

I would suggest phoning them though as my experience is very different to those listed above. When my company was taken over in 2011 they came to the rather odd conclusions that I had been working for both the new and old company at the same time and was drawing two salaries so they adjusted my tax code to account for this. It took about 10 mins on the phone to sort it out.

I had a similar issue five years ago, but both companies issued me a P11D, so the HMRC doubled the value of my benefits and slapped me with a three grand bill. It took months for me to convince them it was a duplication.

If you submitted your return after the cut-off date (Sep?) you are responsible for the numbers, and if you are not standard PAYE and have other income – pay an Accountant.

HMRC…

I am one half of a 50/50 ownership of a business – we recently submitted our returns (and neither have savings or additional incomes).

I have a letter telling me I am in credit by £401.

My business partner has a letter telling him he owes them £401.

Useless ****.

Utterly useless organisation. I’d like to see the lot sacked and the dept built up from scratch. I’m not in favour of privatisation, but I’d make an exception in this case. Simply not fit for purpose.

I had a similar thing by issue of the wrong tax code; I effectively had no tax free allowance for the 4 years after in order to “pay it back” – which made life pretty hard at the time because I wasn’t earning much. Then about three years after it all stabilised I got a cheque out of the blue for £1,900 in overpaid tax from the same period. WTF?

Have a chat with one of your Local Accountant’s and pay them to sort the problem out.

Give you peace of mind and undertaken by an professional body.

If they continue to prove useless ask your local mp to write to them on your behalf, state that you’ve tried to resolve it with them but had no joy. They normally provide a better response via local mp, explaining what in full has happened or apologising, good luck