Tax codes error

Another HMRC Fiasco  – this time its pensions

Following on from last year’s fiasco with incorrect tax codes, HMRC again face an error with tax codes. It seems that they have failed to take account of the state pensions when they sent out the tax codes to people who started to claim their pensions this year.  This has resulted in nearly 150,000 pensioners receiving a demand for underpaid tax.

What happens to affected tax payers?

The same mistake was made in the two previous tax years and many of those affected were able to have their underpayments waived due to Extra Statutory Concessions.  However in this case as the underpayments are for current tax HMRC will not be able to write off these payments. Instead affected tax payers will be given three years in which to settle the outstanding sums.

How has the HMRC responded?

HMRC says it would be working with the Department of work and Pensions at options to improve the exchange of information so that tax codes can be revised to include the state pension when it is first paid.

It seems they have included the state pension in the tax codes for 2011/12 issued recently.  This means that taxpayers should be on the right footing for the future and paying the correct amount of tax from April 2011.

Warnings of tax scams

Issues like these are the perfect breeding ground for fraud and scams. Pensioners are urged to be careful as they may well be targeted by these people claiming to be from tax authorities. 

Why not let us help, our tax team can offer advice on your tax codings just call them on 01792 410100 or email tax@bevanbuckland.co.uk or tweet us a message @bevanbuckland.
Web site http://www.bevanbuckland.co.uk

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: