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P46 (car)
Posted by johnhughesaca on Fri, 29/01/2010 - 10:45
My client’s company car changed in November. The new car is going to increase the BIK, so I have suggested to my client that he pushes his employer to submit P46(car) asap so that tax code can be changed.
The employer has said that HMRC no longer require them to submit form P46(car) form for a change of car – only when a car is provided for the first time, or withdrawn without replacement. Is this correct ? Thanks, John
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Yes
it is.
There is nothing to stop the company submitting a P46(Car) but no requirement other than as they have said - so not on a change of cars.
There is also nothing to stop the client ringing HMRC and asking them to adjust his code to reflect the change if he so wishes.
P46(Car) form
Are you sure?
Per CWG2(2009), section 130
'The completed form P46(car)(new) must be sent within 28 days of the end of the quarter to 5 July, 5 October, 5 January or 5 April in which any of the following take place:
Sounds like a requirement to me!
P46 (car) - change in requirements
see employer bulletin 32...
P46(Car)
For periods from 6 April 2009 onwards, employers will no longer have to complete a form P46(Car) when an employee’s car is replaced. The form will only be required when an employee gets their first car, when they cease to have a car at all and when the number of cars available to them changes (for example they get or cease to have a second car). This will significantly reduce the administrative burden of the P46(Car) on employers.
A temporary revised version of the form will be available on the HMRC website in time for use for the first quarter of 2009-10. A new form will be created for use from 2010-11 onwards.
I stand corrected!
Kate Upcraft
and to add to this from April 2010 HMRC are changing the validations to stop employers submitting changes of car online via the P46(car) (only new or remved cars can be notified now) so employees will have to ask HMRC to make the necessary adjustment to their code or wait unti the P11D is submtted which coul be nearlyy a year later - this is all suposed to be de-regulatory but given that many employees are downsizing so are due a coding uplift it feels more like a rather cynical way to hold on to tax. It's not clear if HMRC will action paper P46(car) forms on change of car but I wouldn't hold my breath!
In year P46(car) are processed
I have sent P46(car) forms to HMRC for a car change and so far they have been processed.
I send them as I'd rather keep the codes up to date as when the underpayment comes out in 2 years time (by the time HMRC process the P11D's!) it's the employer/agent who will get the grief
Kate Upcraft
yes they woud be for now, it's the quarter starting in April that they say they won't action
IMHO
I think the number of P46 car notifications on a change in car was so low that HMRC have decided its not worth pursuing, for once they have done something sensible.
Employee request for PAYE coding amendment
Aware of the P46(car) notification for CHANGE of car being removed, I did help an employee of one client write a letter to HMRC to get the PAYE put right to reflect the new car and thus avoid a tax overpayment or underpayment for 2009/10.
It worked like this (sorry didn't actually "work"):-
I personally believe that the removal of P46(car) notification for car CHANGES was an error of judgmennt on HMRC's part. Yes, brownie points for being seen to be "reducing paperwork / compliance" for employers but increases the likelihood of PAYE under and over payments for employees. Experience tells me that most employees don't like receiving assessments from HMRC showing tax underpaid nor do they like seeing confusing adjustments in one years coding notice regarding previous years under or over paid tax.
Just give them a ring.
I do this a lot and they just take the details over the phone and the new code normally comes out in within about 10 days, saves a lot of time.
have the full details that would be on the P46(car) available and they know which questions to ask. So much quicker and easier.. if your an agent, use the agent priority phone numbers, you get through first time almost everytime.
Replacement cars in 2010/2011
HMRC have removed the requirement to report replacement cars from 2009/2010, but they will still accept and process car changes reported to them by employers until 5/4/2010. For 2010/2011 they will no longer accept any replacement car information from employers. This includes electronically delivered P46(car) replacement car information.
Even though HMRC will no longer accept this information from employers, they have to accept it if it received directly from employees (or their agents).
With employees being encouraged to drive greener cars, shouldn't they receive the resulting tax breaks ASAP instead of having to wait until after the end of the tax year?
The only way you can guarantee that company car drivers will pay the correct amount of tax is to submit a statement of all of the company cars the employee has been provided with. To aid HMRC in incorporating the correct deductions for CAR and FUEL in the employee's tax code it is advisable to show the calculated cash equivalents on this statement.
Our software the P11D Organiser www.p11dorganiser.co.uk produces a company car benefit statement for use by the employee that HMRC will accept to ensure employees tax codes are kept as accurate as possible.