PAYE coding notice problem from Leicester and Northants district

We understand that there is a problem with 2007/08 PAYE coding notices issued by Leicester and Northants, the district dealing with the PAYE taxation of Retirement Annuity Contracts.

According to the tax team at Old Mill Accountancy LLP, all coding notices received include the full Personal Allowance and no State Retirement Pension regardless of whether or not there is already a 'main' code number.

They say that they have spoken with a contact in HMRC and been advised that Leicester & Northants have not accessed any taxpayer records on their tax systems.

Continued...

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Comments

Coding Notices

AnonymousUser | | Permalink

In addition to the current problems created by Leicester/Northants, we seem to be having other Coding Notice issues. We have quite a number of self assessment clients with some PAYE income (either employment or pensions) but who have either rental or investment income creating additional tax liability. For various reasons, and with full agreement of clients, box 23.1 is always ticked so that the correct amount of any additional tax is paid in a single amount. We now seem to be getting codes from various offices kindly issuing codes for 2007/08 to includes these sources of income which are, of course, based on 2005/06 income. This is not what us nor our clients want and in not in accordance with instructions on the ITR. We now either have to write to the Revenue to change the code or write to the clients to explain why the tax on PAYE income will increase. (Can't write one letter this time as they come from a variety of locations). Are others facing this or are we still in a daze after passing 31 January!

Problem for all

AnonymousUser | | Permalink

It is not only a problem for taxpayers without an Agent. We are certain that despite them holding 68-8 forms and giving assurances to the contrary, the Revenue do not send us copy Coding Notices for all clients. Most clients are aware we receive copy documents from the Revenue so are they going to send us the Coding Notices they receive? We propose to send a single letter to Leicester/Northants listing all clients known by us to be affected and asking that each be sorted and that we be advised individually that action has been taken on each. What chance of success in this?? Another costly and un-necessary exercise created by the Revenue.

dnicoll's picture

Funnily enough..

dnicoll | | Permalink

Thanks for raising this issue.

Having read the item this morning, I then had a phone call this afternoon from a gentleman because he had a query over his coding notice (fortunately he used to be self employed and had an accountant, so is not fazed by the Revenue's paper). He got a BR tax code. Yet a quick check on his numbers (he and his wife are both over 75 and have been married for many years) indicates that at worst he would pay no tax, and at best he would get a refund simply from tax overpaid on his investment income.

Oh, and if getting through to Leics and Northants was hard last week, you should have tried today.........

Coding notices from Leicester and Northants district

PeterMarsh | | Permalink

I tried to contact Leicester and Northants district last week, and the number was constantly engaged. I then tried the agents priority number which connected me to the contact centre at East Kilbride. Unfortunately they were unable to access the records, and stated that there was a problem which was beyond their control!

I have now sent a letter regarding the Coding Notice, but as most HMRC offices are not up to date with their post (in spite of the miracle known as "Lean"!) I do not hold our much hope of the Code being corrected promptly.

Is this another well thought our solution as the remedy to the problem of taxing annuities correctly? I feel great sympathy for the many unrepresented taxpayers who have no idea what the Coding Notices mean.

How does one summarise shoddy work?

SimonP | | Permalink

I have received numerous new tax codes from Leics & Northants all of which, it goes without saying, are incorrect.

Every client, without exception, has been classed as a Higher Rate Taxpayer and personal allowances have therefore been restricted.

So now I have to somehow reach HMRC and get them to correct their obvious mistakes; obvious, that is, if they had bothered to use the tax returns already in their possession.

"Tax doesn't have to be taxing."

Now where have I heard that before? hmm!

Revenue side of the RACs story

sallyann45 | | Permalink

In reply to Brian Rayner I have also had many 2007/08 codes which include restrictions to collect HR tax on dividends,or coding out property income.I have found it quicker to phone the relevant district to request that these items are removed and the Rev has revised the tax codes quite quickly-certainly quicker than writing a letter.

I had an interesting conversation with a lady at Leics & Northants.She said the majority of RAC3 forms sent out to annuitants had not been returned.

I have never seen one, presumably they ask for similar info to a P161?

Anyway she said they were issuing 522L for the first annuity and BR for any additional annuities merely to get the cases 'up and running' before 6 April 2007.She admitted they are a stab in the dark-emergency code really.

She said in many cases all they received from the ins coy was name and address of the annuitant -indeed some P2s I received had a 'made up' NINO on.I found that a phone call to Leics & Northants and an exchange of info enabled the Rev to link up their records to the clients main tax office,the 64-8 record,etc, and sensible tax codes then followed.