In November a client’s bookkeeper gave me their payroll changes for the month and said “Can you pay Mr X a net bonus of £5,000 as he has been paid an extra £5k net this month already” (ignoring RTI reporting of payments on time….!) so we grossed it up to around £8.5k and added it to the payroll – all good.
He has just come back and said “whoops” the £5k was not a bonus but was a short term loan that the employee has repaid – the bookkeeper is now panicking !
Question – How do I reverse this? I have tried entering an 8.5k deduction on Moneysoft but it wont let me as it is negative, the individual is on a W1/M1 code so even if we remove remuneration there is no tax refunded
Can I go back in and resubmit earlier periods – I would need to resubmit Nov, Dec and January I presume?
If anyone could give me a pointer that would be great!
Replies (3)
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You need to roll back and re-process
Hi John,
You need to roll back and re-process. With Moneysoft, that is just a matter of opening up the periods.
When you re-submit, you need to set the appropriate flag with the message about why you are making the correction.
Put the correction through with the current code (you can't just change it) - and then get the employee to contact HMRC to request the code is changed. I find the online tool (google something like My Tax Code is Wrong and there is an online tool) tends to get quite a quick response. There is still time to get a new code for February or March payroll.
Whilst the tax code may not get corrected, ultimately that is only a code, and so if there is a refund due it will come in due course.
Not that that helps your employee at this time.
Or alternatively ... Unlock... Adjust and on the next filing it will put everything right... A lot simpler!