Employee Tax Code

Employee Tax Code

We have been approached by a client recently who was highly concerned as HMRC have made request for outstanding Taxes

The client is on PAYE roles only and earns less than £100,000 per year

After reviewing the clients Employment History provided by HMRC

We noticed that the following that the employee held 2 jobs at the same time in each tax year and HMRC have applied 1257L Tax Code to both jobs, which means that the employee has benefited from the Personal Allowance of £12,570 twice

National Insurance can apply for more than 1️⃣ job but with the Personal Allowance there is only 1️⃣, which of course starts to reduce if earn over £100,000

My advice to the client immediately now and for the future to contact HMRC and make them aware of the job circumstances and the total expected Gross income from both jobs so at least they can provide a more accurate tax code to the employer

The major concern here is the Employers and their finance department would have been receiving Tax Code Notices/Student Loan Notices but it is clear that they are not adjusting on their system and then the client has received P800T or Statement of taxes - Underpaid Amount

We have reviewed the documents and did some calculations to determine that there has been underpaid taxes each year, which total up to a significant amount putting unnecessary pressure on the client

If you are in a similar position or received similar letters

Please feel free to reach out and we will be able to assist and advise further

Tel: 01212852534

Web: www.secureaccountsltd.co.uk

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