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HMRC Tax calculation is wrong

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In a case where a taxpayer has PAYE income, and is subject to self-assessment, if a coded underpayment exceeds the tax paid at source via PAYE, the HMRC tax calculation is restricting the underpayment coded to the tax paid at source, resulting in their calculation showing less tax due.

EG. Underpayment coded £1,000. Tax paid via PAYE, £800. SA tax payable £1,500. HMRC will calculate SA tax payable to be £1,300. This has a knock on effect to POAs. I've spoken to HMRC who confirm that their calculation is doing this, and I've spoken to IRIS who confirm that their calculation is per HMRC specifications. I believe that IRIS are correct.

I have no idea who to talk to next. Perhaps @John Hemming has a clue who to talk to?

Replies (55)

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By Wanderer
21st Jul 2021 14:10

Normally in this situation you get an adjustment on the SA account "No longer collected under PAYE" & then a demand to pay 30 days later.

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Replying to Wanderer:
By SteveHa
21st Jul 2021 14:20

That's not it - the Return was submitted months ago. Nevertheless, it doesn't alter the fact that HMRC don't appear to follow their own brief when calculating.

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By Not Anonymous
21st Jul 2021 14:28

Do you mean £1,000 was coded in the year the SA return is being completed for i.e. 2018/19 underpayment of £1,000 was included in the 2020/21 tax code and you are now completing the 2020/21 return?

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Replying to Not Anonymous:
By SteveHa
21st Jul 2021 15:35

It's the 19/20 Return, which was submitted by 31 January 2021, but otherwise essentially yes. However, HMRC's calculation of tax payable is restricting the coded underpayment to tax deducted at source (so although £1,000 was coded, they are only including £800 in the SA calculation), effectively undercharging by £200.

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Replying to SteveHa:
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By gillybean04
22nd Jul 2021 09:34

May I ask....have you checked the SA300, or just the SA302?

SA302 gives liability for a particular year only. If an underpayment from a previous year is coded, then the calculation needs to take account of the underpayment, to check it was collected, but that's all. It doesn't form part of the 19/20 liability, it remains a liability of the previous year.

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By Tax Dragon
21st Jul 2021 16:39

Is HMRC wrong? You've got £500 to pay for 2019/20 and £1,000 for previous years of which £800 was collected. Is the £200 not collected a liability of 2019/20?

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By rmillaree
21st Jul 2021 17:22

SteveHa
can you confirm income levels
can you confirm if underpayment coded out 1000 is prior year liability coded this year
and line by line tax entries in the tax calc please

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By johnhemming
22nd Jul 2021 08:06

Sorry, but I have only been doing the MTD software and not the other versions. You could ask your MP to write to the FST (Jesse Norman). That may elicit a response of some use.

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By SteveHa
22nd Jul 2021 09:17

I have spoken to each of HMRC and IRIS. HMRC confirmed thee method that they have used, and IRIS have confirmed that their software is in accordance with the HMRC brief, and so either way, the faulkt is with HMRC.

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Replying to SteveHa:
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By Tax Dragon
22nd Jul 2021 10:59

Fault? You're missing my point.

Does gillybean04's explanation of that point make it more clearly? Probably. Ignore me. Read gillybean.

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Replying to Tax Dragon:
By SteveHa
22nd Jul 2021 14:26

No, I get your point fully, and if HMRC are correct that the difference is excluded from the liability from the year, then the brief that they provide for developers (which does not include this exclusion) is wrong. If the brief provided to developers is correct, then the HMRC calculation is wrong.

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Replying to SteveHa:
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By rmillaree
22nd Jul 2021 14:38

StaveHa
Can you please post the income total and the line by line entries for the tax calc from start to finish - i still feel there may be something getting lost in translation
here - and having the full calc on line by line basis will add much needed clarity.

I do see where you are coming from though as hmrc will never knowingly allow tax liability to be coded out if tax being coded out if over 50% of tax being deducted via the paye coding source at the time coding is being colleced - i have never seen this issue impact on tax calcs other than with hindsight viewpoint when they simply refuse the coding request after the fact by demanding payment- perhaps now they have slightly changed their tune and will put some of the amount back in the tax calc - then again i am probably talking about a different situation anyway so will go back to sleep unless i see a line by line calculation

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Replying to rmillaree:
By SteveHa
22nd Jul 2021 15:34

Work with:

Employment £8,000 Tax paid £800
Dividends £22,000
Total £30,000
PA £12,500
Taxable £17,500
£2,000 @ 0%
£15,500 @ 7.5% = £1,162.50
Tax @ source £800.00
Underpayment coded £1,200.00
Total due (per IRIS) £1,562.50

Total due per HMRC £1,162.50

So one of them is wrong (and I don't care which), but HMRC have either created the calculation themselves (their figure) or provided the developer brief for the software provided. In either case, HMRC have got something wrong, and I don't know who to speak to to get them to fix the disparity.
Underpayment coded £1,200.

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Replying to SteveHa:
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By rmillaree
22nd Jul 2021 16:07

btc comes up with 1562.50 which i agree is the correct answer here
To see why hmrc have 1162.50 - we would need to look at line by line entries from their tax calc - and see what the bottom line difference is.Helpline should go through line entries if you do not have copy

btc doesnt warn that this tax may be to high to be collected via coding adjust (it does at higher dividend income levels)

Is it possible a coding request has been made and hmrc have agreed to code £400 of the bill and are demanded settlement of the other £1,162.50 on the nromal due date.

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Replying to rmillaree:
By SteveHa
22nd Jul 2021 16:09

I know what they have done. They have restricted the underpayment coded to tax paid via PAYE (i.e. £800) and so the underpayment and PAYE cancel each other out, and nothing more.

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By emanresu
22nd Jul 2021 13:53

A paragraph-long single sentence is confusing.

Could you give absolute data - with its source?

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Replying to emanresu:
By SteveHa
22nd Jul 2021 14:29

If you use any commercial software, punch figures in that show PAYE income with tax deducted of £800, untaxed income to create a further liability, and a coded underpayment of £1,000. I fail to see how my question is ambiguous.

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Replying to SteveHa:
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By rmillaree
22nd Jul 2021 15:29

"If you use any commercial software, punch figures in that show PAYE income with tax deducted of £800, untaxed income to create a further liability, and a coded underpayment of £1,000. I fail to see how my question is ambiguous."

The question is ambigous because if we dont know the income level we dont know the calculated final tax bill - and the level of the final tax bill can change whether the system decides something can or cant be done. So without income details someone may be lucky enough to replicate your situation but unles you provide full chapter and verse datils they may be unable to replicate if the missing info is different to what you have.
Note i can get a warning on my system on my system using selected random amounts - all that says is that hmrc may refuse the tax code request due to the low level of tax deducted from main income source - i do have the option to proceed here. I use btc and this warning is as it was - note btc is giving us choice here not all software may be so flexible.

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Replying to rmillaree:
By SteveHa
22nd Jul 2021 15:35

See above.

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Replying to SteveHa:
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By emanresu
22nd Jul 2021 20:04

Putting it bluntly, you are only providing your interpretation, with the attendant risk of bias.

Just give us the HMRC data - SA302 and historical P2 and SA300.

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Replying to emanresu:
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By rmillaree
23rd Jul 2021 09:02

"Putting it bluntly, you are only providing your interpretation, with the attendant risk of bias.
Just give us the HMRC data - SA302 and historical P2 and SA300."

Agreed 100% emanresu- 3 minute phonecall to hmrc should confirm exactly what has been adjusted where when and by whom (and probably why unless its an hmrc glitch or complicated technical stuff ). This is a mechanical check the numbers against each other exercise - once the exact details of the adjustment made are known then we can speculate why (if hmrc dont spell it out). HMRC do not amnend tax calculations without providing the detail of the amendments done.

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Replying to rmillaree:
By SteveHa
23rd Jul 2021 09:10

Do not patronise me. I worked for HMRC 20 years, and in practice at a senior level for the next 20. If you think I haven't already had the conversations with both IRIS and HMRC, then you haven't read what I've said.

There is no supposition here.

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Replying to SteveHa:
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By rmillaree
23rd Jul 2021 13:57

"Do not patronise me. "
It was not meant to be patronising - apologies if it came over that way. It just my frank opinion thats all sorry if you dont like to here that.

The point i was trying to illustrate is that in my experience hmrc have always confirmed the line item comparisons when pushed - so i am still somewhat puzzled why they (hmrc) can't explain the exact line item difference between the two calculations - ie if you can list how hmrc got to 1152.50 in the same manner as the cal that got to the total £400 higher

it may be in this case they are refusing or cant do that - i can't ever remember hmrc not being able to explain how their figure has been arrived at before which is why i posted what i did. The answer may very well be in the thread but its a bit confusing to work out which is the correct explanationm if the answer is in this thread.

Hey ho if you dont like what i have to say please diregard my comments.

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Replying to rmillaree:
By SteveHa
23rd Jul 2021 14:36

OK, for the avoidance of doubt, and from my OP.

Quote:
the HMRC tax calculation is restricting the underpayment coded to the tax paid at source

and so, to adapt the calculation I previoulsy provided, for absolute clarity.

HMRC are doing:

Employment £8,000 Tax paid £800
Dividends £22,000
Total £30,000
PA £12,500
Taxable £17,500
£2,000 @ 0%
£15,500 @ 7.5% = £1,162.50
Tax @ source £800.00
Underpayment coded restricted to tax paid £800.00
Total due (per IRIS) £1,162.50

IRIS is not restricting the underpayment coded to tax paid, and so produces a £400 higher tax liability. One or the other is wrong, and to be honest I'm past caring which. I just want to know who to talk to to get everyone singing from the same hymn sheet.

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Replying to SteveHa:
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By rmillaree
23rd Jul 2021 15:23

Thanks for posting that Steve - its now 100% clear to me where we are at (i think)

The only thing that matters practicably speaking is that the underpayment coding is consistent. You may be able to get hmrc to right a wrong one but sometimes you run into a brick wall and ned to go with the flow unless the result is not acceptable.
So if we take the viewpoint that hmrc wont budge on that £800 in the calculation
then i would be defaulting to saying that the £1162.50 has now been cofnirmed.

There will be in the ether a £400 adjustment - so we need to go back to the year where the £1,200 was originally coded out - look at that years tax calculation (hmrc version). If hmrc have amended the calculation now to be £800 everything is consistent and it should be clear that the £400 has ended up somewhere.
If the 1200 is showing in the prior years tax calc still then you need to tell hmrc there is an anomoly between the two figures that shpuld match (coded out to later year - and tax coded from earlier year) and ask them to look into that. If it is a fairly recent calculation it may be that hmrc simply have chucked out the £400 demand that will be chucked out soon. Either way its deffo their issue to correct/explain if the two figures dont flow flow through consistently - i would expect they would send referal and eventually get it sorted. I don't see that hmrc can pass any bucks when pressed on where tax coded out has gone too!

In the meantime i would tell the client there is a reasonable chance that they may soon get a demand for £400 or have to pay £400 - unless hmrc relenmt and realise their msiutake (if tahts waht it is) and correct the later calcs back to the higher figure.

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Replying to SteveHa:
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By Tax Dragon
23rd Jul 2021 09:47

SteveHa wrote:

I fail to see how my question is ambiguous.

It's not now. But I hadn't appreciated until many posts into this thread (and well after both my comments above) that the HMRC comp and the IRIS comp were different.

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By DKB-Sheffield
22nd Jul 2021 16:50

Hi Steve

I take it you've looked at the tax coding notices (tax payer version - not employer version), and PAYE deductions for the year of assessment AND for each year since? If not, they may explain the issues (particulary as you refer to the SATR for 2019/20 which was only really filed shortly before the end of the 2020/21 tax year. Is it possible that the underpayment has been coded in a later year? HMRC won't generally "code" AND seek payment.

Furthermore, if the coding notice for 2019/20 was 650L (assuming the calculated coding was for £1,200 recovered at 20%, and that this was a reduction of the "normal" coding), the actual tax deducted at source would appear to be too high (suggesting a different code was used for the Employment income).

Regardless of the above, this is the reason I rarely advise clients to pay tax through their tax code!

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Replying to DKB-Sheffield:
By SteveHa
23rd Jul 2021 09:17

It's not the tax code, or even the methodology that I take issue with. It's that two pieces of software (HMRC's and IRIS), which are both, ostensibly, based on the same brief, produce different results, and each are adamant that they are correct based on that brief.

Since the calculation does not form a part of the Return (except to the extent that that calculated amount appears on the Return), HMRC have not issued a notice of "correction", nor have they opened an enquiry. At this point, especially given some of the responses, I'm not entirely sure which is correct, now (I was sure IRIS was initially, but I now have my doubts), but irrespective, the fact that both based on the same brief differ means that something needs fixing. Since HMRC develop (via contractors, admittedly) their own calculation, and since HMRC issue the brief to third party developers, this sits firmly with HMRC.

My issue is, how the hell do I get that message across to HMRC?

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Replying to SteveHa:
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By Hugo Fair
23rd Jul 2021 13:10

"My issue is, how the hell do I get that message across to HMRC?"

No promises that it will be effective, but you could try emailing SDST (Software Developers Support Team) at HMRC. Like so much of HMRC they have taken to not providing individual contact (telephone or email) points any more, but an email sent to [email protected] should either generate a response or be passed to the relevant people elsewhere within HMRC.

If that doesn't work, you can DM me and I'll try to dig out a few of the more helpful names who are hopefully still accessible ... or at worst the direct contact details for one of the 'seniors'.

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Replying to Hugo Fair:
By SteveHa
23rd Jul 2021 14:38

Thank you. An answer to the question asked.

I'll try them, and get back to you if no joy.

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By richard thomas
22nd Jul 2021 17:04

It’s a wild guess, but it may be that HMRC’s tax calculation doesn’t deal correctly with the section 59B(2)(a) TMA adjustment.

Section 59B(1) provides that the tax charged in the SA less PoAs and any income tax deducted at source is the tax payable at 31 January. In this case that figure is £800.

Section 59(2)(a) makes an adjustment so that any amount deducted at source under PAYE which relates to a previous year (as in this case) is deducted from the subsection (1) tax at source amount.

Logic suggests that the figure after adjustment cannot be less than nil, for the reasons given above, that if only £800 was deducted then the amount of the UP of £1200 that was actually deducted cannot exceed £800 as there was £400 not deducted, so that the tax at source used in the tax calculation should be nil.

But the HMRC tax calculation seems to have simply taken two figures and deducted one from the other to give an answer of -£400. What would be interesting to know is what the code used in the tax year was and how it was calculated.

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Replying to richard thomas:
By SteveHa
23rd Jul 2021 09:21

Thank you, Richard. That, at least, gives me some comfort that my original inclination that HMRC are wrong was correct.

In the case in point, I have continued to advise the client to pay based on our calculation, rather than HMRC's. In some ways, it is fortunate that this is a client that seems to leave payment as something other people do. If it was a prompt payer, there is a very real danger that HMRC could make a refund of tax that is not actually repayable.

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By Tax Dragon
23rd Jul 2021 10:02

SteveHa wrote:

Work with...
£15,500 @ 7.5% = £1,162.50
Tax @ source £800.00
Underpayment coded £1,200.00
Total due (per IRIS) £1,562.50

Total due per HMRC £1,162.50

So the 2019/20 tax is £1,162.50. The tax deducted at source is £800, adjusted to £Nil by s59B as Richard points out, leaving £1,162.50 to pay under SA for 2019/20.

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Replying to Tax Dragon:
By SteveHa
23rd Jul 2021 12:41

Yes, but IRIS and HMRC don't seem to agree on this.

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Replying to SteveHa:
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By Tax Dragon
23rd Jul 2021 12:51

TD and HMRC agree.

It's possible (I haven't looked) that both IRIS and HMRC expect you to enter the amount of tax that was collected, not the figure that appeared in a tax code.

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Replying to Tax Dragon:
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By Tax Dragon
23rd Jul 2021 13:33

Tax Dragon wrote:

It's possible (I haven't looked) that both IRIS and HMRC expect you to enter the amount of tax that was collected, not the figure that appeared in a tax code.

I've looked. They don't. But doesn't the HMRC result follow from the step at box A303, which takes the lower of the A301 and A302 figures? Then A304 is zero - IRIS must have -£400 here??

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Replying to Tax Dragon:
By SteveHa
23rd Jul 2021 14:49

I don't dispute that IRIS may be wrong (I started from a position that IRIS was right, but am now shifting following some responses here), but that doesn't alter the fact that the HMRC calculation, and the HMRC mandated calculation for developers produce different results.

Thanks to Hugo, I am at least now able to engage with HMRC and hopefully get it fixed.

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Replying to SteveHa:
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By Tax Dragon
23rd Jul 2021 14:58

Good luck.

If you run the TCSN calculation by hand, I don't think your doubt about which is correct will persist. (And tbh I'd've thought that was all the brief anyone needed - but that's not something I know about... time I said you-now-what again.)

I'm out.

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Replying to SteveHa:
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By More unearned luck
23rd Jul 2021 16:09

If you now think that IRIS is wrong, then why do you need to 'engage with' HMRC? Surely all you need to do is to ask how they intend to collect the £400?

If your position is that HMRC is wrong then you should reject HMRC's purported amendment to your client's SA (s 9ZB(5) TMA 1970)

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By richard thomas
23rd Jul 2021 16:52

First – apologies to all. In my post of yesterday at 17:04 I suggested that it was HMRC who had come up with the higher figure (£1562.50). (Just as an aside I note that in his post of 14:36 today, SteveHa seems to be suggesting that it is Iris who come up with the lower figure (£1162.50) “Total tax due (per IRIS) £1,162.50” but the context, ie the final paragraph, suggests that this may be a slip.

On that basis it seems that HMRC’s tax calculation does it correctly, and somewhere in the background limits the adjustment under s 59B(2)(a) to the tax actually deducted under PAYE.

Tax Dragon in their posts of 13:33 & 14:58 today mentions the “hand” calculation, ie that produced by using the TCSN (SA110 Notes). I do not think the entries mentioned are relevant.

A302 and A303 refer to coding out “outstanding debts”. This is a different concept from underpayments coded out. Outstanding debts are debts due to HMRC for taxes and other amounts that have become due and payable but are not paid, eg SA balancing payments unpaid. The facility to code these out was introduced for 2012-13 and later and is in regulation 14A of the PAYE Regulations (for “relevant” debts), 14B (HICBC), 14C (tax credits) and 14D (overall limit – it is up to £17,000 depending on the amount of PAYE income).

Underpayments where coding out is opted for* in the return on the page “If you have not paid enough tax” on screen are governed by regulation 14(1)(d) and 186 (which limits the UP coded out to £3,000) in SA cases (but not others).

Note that the figures in A302 go to box 9 in the tax calculation summary (SA110), not Box 7 where coded out underpayments go. It is A332 where the figure for a coded out U/P go, and from there it goes to Box 7 in the SA110 and to box A340 in the TCSN as a component of “Total Income Tax etc due”. Thus in the paper return it will be an addition to income, not a subtraction from “Tax deducted at source”. This is also how the electronic version of the return does it if you print off your tax calculation from your PTA or SA account. I happen to have had this situation for 2018-19 as I had an earlier UP coded out. I have just downloaded my tax calculation which says (figures redacted, as I don’t want you to know how much or how little I earned as a judge)

Total Income on which tax has been charged X
Income tax due Y
plus Underpaid tax for earlier years in your tax code Z
Income tax due Y +Z
minus Tax deducted
From all employments, UK pensions and state benefits A
Total tax deducted A
Total Income Tax Due (Y+Z)-A

This is not the same as the way SteveHa’s line entries have it.

The figure at A332 in the TCSN is required to be the figure in the code number, not the figure actually deducted.

In the electronic return you are given a figure of coded out underpayment which you can accept or reject and change. I assume that will be the code amount, but there might be something in the background which limits the figure to the PAYE deducted which will be on the RTI returns and will feed through to an individual record like P14s did.

Going back to SteveHa’s case, if the U/P figure in the return questions was £1,200 and the electronic calculation follows the paper one, then it is £1,200 that should have been added to income. This would, ceteris paribus, make the tax bill £1,562.50. So it seems that the HMRC calculation makes some adjustment that IRIS does not, which is difficult to fathom if they use the same calculation program.

I remain mystified by it all, but under the law the bill is £1,162.50. The taxpayer still owes £400 of the U/P, but I do not see how that can be collected through SA. It can be collected through a further coding restriction.

*This is not what the law says. Regulation 14 makes it mandatory to code out if the conditions in regulation 186 are met, and the paper return at TR6 box 2 reflects that as you opt out. The relevant page in the 2019-20 online return says:

If you are submitting by 30 December, owe tax for 2019-20 and have a PAYE tax code, do you want us to try to collect the tax and Class 4 NICs due (if less than £3,000) through your tax code for 2021-22? Yes X No X

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Replying to richard thomas:
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By Tax Dragon
23rd Jul 2021 17:21

richard thomas wrote:

Regulation 14 makes it mandatory to code out if the conditions in regulation 186 are met...The relevant page in the 2019-20 online return...

That's the personal government gateway online return, presumably? With any commercial software I've seen, you tick a box to opt out.

I thought one country, two systems was China (as it used to be... all gone badly wrong now).

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By emanresu
23rd Jul 2021 21:08

Quote the original data, not your interpretation of it!

For instance,
"HMRC are doing:
...
Total due (per IRIS) £1,162.50"

I've never seen any mention of that line in an SA302, let alone in an SA300 or a P2. Do HMRC include references to specific software packages? Anyone?

See what I meant in my:

"Putting it bluntly, you are only providing your interpretation, with the attendant risk of bias. Just give us the HMRC data - SA302 and historical P2 and SA300."

You've titled this topic "HMRC Tax calculation is wrong", but there's no inconsistency between HMRC's and Iris's Tax Calculation. Your issue is about the discharge of subsequent liabilities. That's why I asked for the history of P2s and SA300s

E&OE.

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Replying to emanresu:
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By rmillaree
24th Jul 2021 08:59

Emamresu
I must admit this thread but have been way less confusing if the op had posted the two full calculations from the start which confirm that the difference is simply a disagreement over how much prior year tax hmrc think should be in the calculation. Both calcs have been posted now though so at least that issue is cleared up now.

At the end though this unexpected adjustment does affect the bottom line number of what needs to be paid now so I do also see where the op is coming from when they say call is wrong.

I would say it’s not unusual for hmrc to be very inflexible with regard to amounts coded out to later years.
I have seem numerous instances where the computer does something that is wrong and it can take months for the backend team to sort.
In this regard practically speaking all I would care about is that the adjustment is treated consistently between the two years - hmrc must ultimately answer that question if it’s not consistent they must address that and sort.
To me there are 3 remaining possible outcomes here ref the unpaid tax prior year quibble
Hmrc will realise their error and revise calc back to what was submitted.
the amount entered by the op was wrong and had previously been revised or was different in the first place so there was no error here it was simply wrong total entered(very unlikely to be the case)
Hmrc will stick to their guns ref this calculation in which case hmrc need to confirm how the £400 owed ref prior year will now be collected.

IMHO if hmrc are confronted as to why the prior Year underpayment is different there is no circumstance under which they will not fully explain what the outcome is when pushed on the subject.

In some respects the software here is probably the innocent party.I have always defaulted back to hmrc ref underpayment queries as ultimately my beef is with hmrc to explain why they have what they have on their system i will demand an explanation from them Every time.It is possible though that the software may have not done something it should have done.
Must admit I have never seen hmrc at the submission of return date revise downover a prior year underpayment - this seems illogical and nonsensical but may have some element of rational thought with regard to the fact hmrc do have their limit with regard to hum much tax they will code out. So I would go with one of the first two options above being correct.
As we all know hmrc do change their rules and sometimes unfortunately I think they are dictated to by what a computer does so it may well be that option 3 above turns out to be the way hmrc want to play this.
Has anyone else ever seen an underpayment notice amount coded out to a year that has later been reduced downover after the end of the year the tax is collected? I have never seen that- the closest I have seen was figure purporting to be a prior year underpayment that wasn’t - in which case hmrc corrected their numptiness.

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Replying to rmillaree:
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By emanresu
24th Jul 2021 10:37

IMHO the thread would have been signicantly shorter if the reserved term Tax Calculation had not been repeatedly misused.

Plus my previous point regarding raw data.

I don't know about others, but I increasingly find that the best bit of equipment in the hunt for the guilty party is a mirror.

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Replying to emanresu:
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By richard thomas
28th Jul 2021 15:59

I am completely with you in relation to your comments about raw data, as I am still not sure where and how the extra £400 manifested itself.

But I am afraid I don’t understand your first sentence, and in particular what “reserved term” means and where it has been “repeatedly misused” (and if you mean misused in this thread or more generally), and also how correct use would have shortened the thread.

Thus I would be interested to know what you mean by “reserved term”, as I have not come across it before in relation to tax law or practice, and I would like the “raw data” on the examples of its misuse.

Following your reply I shall consult my mirror.

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Replying to richard thomas:
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By emanresu
28th Jul 2021 20:30

I'm not sure that you are not pulling my leg - and I'm not here to be a school-teacher - but: term n. a name, expression or word used for some particular thing in a specialised field of knowledge. CED. Now write that out 50 times.

In this case HMRC uses - reserves, even - the term Tax Calculation to refer to that which is presented on an SA302. Everything covered in this thread which involves the HMRC Tax Calculation - the hunt for the guilty - is it IRIS or HMRC - most of the data, raw or half-baked - was a waste of time and typing as we discover that they actually both agree the HMRC Tax Calculation.

A common nomenclature / understanding is a worthy aim. At least I think so.

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Replying to emanresu:
By SteveHa
29th Jul 2021 09:34

emanresu wrote:

In this case HMRC uses - reserves, even - the term Tax Calculation to refer to that which is presented on an SA302.

With respect, how on earth have you come to that conclusion? Any PY underpayment coded in a tax year is used in the calculation for SA302 purposes. Because you take issue that it appears in that calculation after the tax due for the year does not maike that any less true.

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Replying to SteveHa:
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By emanresu
29th Jul 2021 12:38

1. From HMRC. e.g. this URL:

https://www.gov.uk/sa302-tax-calculation

2. gillybean04 was first with this, me next, then others. Screen-shots or whatever of actual documents. Why the reluctance?

Incidentally, I don't carry the flag for the word "reserved". I typed the aspiration "reserved" and then the word "term", and then checked the CED - to find that I was spot-on in using that second word ("some particular thing in a specialised field of knowledge" - note thing, not things) . If only HMRC worked that way.

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Replying to emanresu:
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By rmillaree
29th Jul 2021 13:58

I think we can find a common middle groud here

Lets say we all find something to agree on rather than disagree = ok lets see if wecan have 100% agreemnt on the following points ( i can but hope :)

1. both tax comps have now been posted sufficienty so difference is clear
2 its clear hmrc have amended the "underpaid tax from prior year" total included in this years computation
3 the underpaid tax from an early year coded out is an "after the tax charged calculated for year " line item. So you can quibble either way as to whether its part of the tax calculated or not - practicably speaking it is what it is in that regard and arguing one way or the other is simply arguing where that line should be drawn. Item deffo does show up in my sa302's calculated but i am ware its an entry after the tax has been calculated = so in some respects arguing either way isnt obviously wrong (to rmillaree) but may be obviously wrong to others.

4 the coded out figure included in this years comp is decided by hmrc computers which will ovewrite anything that may be entered in the tax comp - this can potentially be amended at any time by hmrc and it can also be amended multiple times by hmrc.
5 if the coded out figure at 4 makes no sense then hmrc should be able to explain why it is what it is when pushed - and correct if its a wonky donkey.

If we all agree on points 1 tom 5 i dont think there is anything really worth arguing about so hopefully this thread can be ended?
Then again .......

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Replying to SteveHa:
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By Hugo Fair
29th Jul 2021 12:55

The clue's in the name ... maybe emanresu also applies backwards logic.
By which I mean the claim that "HMRC uses .. the term Tax Calculation to refer to that which is presented on an SA302" is true (but not always), however certainly doesn't mean that "Tax Calculation" can *only* refer to that situation.
[All cows are animals, but not all animals are cows - as we were taught aged 10].
emanresu may enjoy reading https://en.wikipedia.org/wiki/Reserved_word for an insight into the generic (non-HMRC specific) use of 'reserved' with word.

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