Norwegian p45, which UK Tax return does it go into

Norwegian p45, which UK Tax return does it go into

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Hi

I have a client who has done some work in Norway, their tax year goes from 1st January to 31st December whereas ours goes from 6 April to 5th April (individuals) The client has a P45 dated 26/12/2012.  

I would assumed that these figures would go into the UK 12/13 tax return along with the double taxation relief?  Is this true as HMRC are saying that it is for the year 11/12!

Any advice would be greatly appreciated before I have to go before I have to go back to HMRC.

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By johngroganjga
27th Nov 2014 14:55

If you have asked HMRC this question already (not sure why you felt the need to) the answer I would have expected them to give is that you need to split the income into two parts.  That from 1 January 2012 to 5 April 2012 would go on the 2011/2012 UK return - and I am sure you can guess the rest.

Is that what they did in fact say? 

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By A E Scott
27th Nov 2014 15:49

I was calling HMRC as they had investigated my client and had done a recalculation, I didn't think they had applied the double taxation relief to the self assessment as the amount of tax due is almost the same as the amount that the norwegian authorities are requesting!

HMRC have used the full figures for the whole year in the calculation, does this mean that HMRC have done the recalculation wrong?

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By johngroganjga
27th Nov 2014 15:56

If the year in which they have taxed him on all his 2012 Norwegian income is 2011/2012, as you seem to be suggesting, then yes that is plainly wrong. 

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By A E Scott
27th Nov 2014 16:15

So in that case the income that he was taxed on his 2012 Norwegian tax return should be added to his UK 12/13 tax return?  Is that correct?

I just don't want to go back to HMRC and advise this and look like a fool if it is not the case! Also further to your earlier note, about splitting the income, is this no longer the case now due to your last comment?

Sorry if i seem a little (or a lot) dim i just need to make sure I am clear about the situation before a make calls etc.

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Replying to paulwakefield1:
By johngroganjga
27th Nov 2014 16:56

Common sense

A E Scott wrote:

So in that case the income that he was taxed on his 2012 Norwegian tax return should be added to his UK 12/13 tax return?  Is that correct?

I just don't want to go back to HMRC and advise this and look like a fool if it is not the case! Also further to your earlier note, about splitting the income, is this no longer the case now due to your last comment?

Sorry if i seem a little (or a lot) dim i just need to make sure I am clear about the situation before a make calls etc.

I am simply applying common sense here.  On the 2011/2012 UK tax return client has to report income from all sources in the year in question - which is the year ended 5 April 2012 isn't it?  By no stretch of the imagination was client's Norwegian income in the period after 5 April 2012 received in 2011/2012.  That's all really.

 

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Replying to WhichTyler:
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By A E Scott
27th Nov 2014 17:17

Yes that was my thought exactly, as the P45 was dated 26/12/12 i would assumed that we would add it to the 12/13 UK return (as the income is between 6/4/12-5/4/13), but HMRC advised that it was for the tax return 11/12 which is why i was querying it, as it didnt make sense to me either.  Thanks for clarifying this for me.

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By paras007
27th Nov 2014 16:25

Norwegian p45?

Does Norway have forms called P45? P45 suggests a UK payroll form.

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By A E Scott
27th Nov 2014 16:34

Its quite technical, my client worked for a firm who paid all of his tax within his contract.  He was paid in Nok, UK NIC employers was added, plus Norwegian tax, plus UK NIC employees, he was provided with a p45 from the UK company that he was working through in Norway.  As far as hes concerned all of his tax has been deducted and paid through the company who he was working through.

There is no tax on the UK p45 as it has all been paid via the norwegian tax office, the tax already paid is added to his UK self assessment  via the double taxation treaty, so that he doesn't get taxed twice on the income.

I just need to be sure that the figures that I have go to the correct tax return in the UK and that double taxation treaty has been declared on the return.

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By User deleted
27th Nov 2014 16:41

Norwegian tax

If the company he is working for has paid his Norwegian tax on his behalf, then this may need to be added to his gross pay.

I think you should be clearer on what's added, plussed and deducted to/from the pay, and who's paying what, as it's very difficult to interpret.

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By A E Scott
27th Nov 2014 17:07

Sorry.

Ok an example of what he is getting paid is below (however i dont think this is the problem, its deciding which UK tax return the gross is applicable to and if the double taxation has been taken care of)

net rate payable (stirling) £2520

plus UK NIC employers £297.25

= gross for tax - £2817.25

plus norwegian tax £650.65

plus UK NIC Employees £257.28

Total Payable £3725.18

so he receives the net of £2520 and all the rest is paid over on his behalf and the gross amount of £3725.18 is added as his income. (this is for one month in this case)  the gross overall for the full period in question is on his p45 or P60 for his previous year.

 

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