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I thoughtI understood income tax.

I thoughtI understood income tax.

I have been asked to repay tax by HMRC on the grounds that I had not included ''underpaid tax for earlier years in your tax code for 2011/12''

My tax affairs are extremely simple, although I do have two employments.  I always submit SA forms on time etc.  Nowhere have I been notified that I have any 'underpaid tax in my PAYE code', whatever that may mean.

I had always thought that any 'inaccuracies' in my PAYE code during the tax year would be corrected at the end of the year when I submit my SA.

Can anyone put me wise, please?


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29th Jan 2013 12:57

Look at the last notice of coding you got

See if you can find the last 2011/12 notice of coding you received as, in theory, this will have included an adjustment needed to collect some old tax.

I'm assuming the query has arisen because you included all of your 2011/12 P60 tax in your 2012 tax return submission.  If there was an adjustment in your coding for old tax of say £100 then you can not use that £100 of the tax on your P60 to offset 2011/12 tax bill, ie you ignore it when entering the P60 figure.

As I tell all my PAYE clients, you are involved in the messiest aspect of UK tax.

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By ACDWebb
29th Jan 2013 13:22

As Paul says

you should find that your 2011/12 coding notice (if you can find it) includes an adjustment to collect tax from a previous year.

In all probability that will be the year 2009/10. Your return for 2009/10 would have been due to be submitted to HMRC by 31 Jan 2011, but if you submitted before 30 Dec 2010 then HMRC would collect any underpayment for the year by adjusting your tax code for a later year (2011/12) on request.

Again as above if the tax underpaid for 2009/10 was £100 and was to be collected by a coding adjustment in 2011/12 then your 2011/12 return also has to include an adjustment to show that as otherwise the underpayment collected through your code would just be repaid by the return

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