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Legislation changes to tax coding notices

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6th Jan 2015
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A legislation change that may see tax coding notices sent electronically rather than on paper in the future, could save the Revenue an estimated £5.2m in print and postage costs. 

The measures, outlined in a Tax Information and Impact Notice (TIIN) today is a bid by HMRC to improve their customer service levels by freeing up resources and being able to manage customer demand. It says the changes will pave the way for the provision of such information through digital channels.

Changes to the PAYE Regulations 2003 also means employees whose PAYE income isn't chargeable to tax or who have no tax liability in respect of PAYE income will no longer be issued with coding notices. 

In addition the Revenue dropped plans to implement a 30-day delay between issuing an amended code to the employer and notice of the code on form P2 to the employee. The Revenue faced strong opposition to this from employers during a consultation it held during the summer last year. 

This, HMRC said, reduces the “needless uncertainty” and concern that a coding notice receipt often causes employees when they have got no tax to pay on PAYE income.

The worry often results in the employee contacting HMRC and therefore putting pressure on the department's resources during busy periods.

"Removing the requirement to issue a notice of coding where the employee or annuitant has no tax to pay on their taxable income will avoid unnecessary uncertainty caused by HMRC issuing such notices, and reduce the number of employees contacting HMRC for this reassurance.

Amendments to the legislation come into force on 27 January.

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