Paid VAT due to PAYE account

Paid VAT due to PAYE account

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Our client paid their VAT due to their PAYE account. *sigh*

Is there a better way to resolve this than phoning up seperately the VAT helpline and PAYE helpline, asking them to put a hold on the chase letters/interest charged on VAT due, then transfer the paymnet across from PAYE to VAT. Am i living in a dream world HMRC would be able to cope with that?

Or should i just send a letter followed by phoning  HMRC several times to ensure the letter has been received/actioned etc etc.

People must've had clinets do the same.

Any advice?

Thanks

 

Replies (26)

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By Wanderer
25th Oct 2023 12:06

Used to be easy when the Collector of Taxes was a different number AND they answered the phones. Nowadays If the PAYE account will 'use up' the VAT payment over the next few months I'd just leave it & pay the VAT separately, to the VAT account.

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Replying to Wanderer:
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By rmillaree
25th Oct 2023 12:17

" I'd just leave it & pay the VAT separately, to the VAT account."

with the new automatic interest and late payment penalties applying this is possibly a really bad suggestion if that point has been pased where either of these would apply.

I have never had problem getting hmrc payments reallocated eventually albeit vat may be the hardest. I would start by contact tax that should have the money and stating payment been misallocated - i would always get details of exactly what is on bank statement and have details of how paid. Hopefully fact its in paye will make job simpler.

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Replying to rmillaree:
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By Wanderer
25th Oct 2023 12:46

rmillaree wrote:

... if that point has been pased where either of these would apply.

Well maybe, but that is introducing a new fact which wasn't in the OP.
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Replying to Wanderer:
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By rmillaree
25th Oct 2023 13:31

"Well maybe, but that is introducing a new fact which wasn't in the OP."

even if its not referenced its relevant imho as it could be late and there could be penalties and interest- if you dont know there isnt penalties and interest being charged and your advise is ignoring that prospectbe imho thats poor advise -i would say its more probable than not interest at least may be apllicable - from experience by the time us accountants know payment has been misallocated due date is normally past and its then only a few days before first 2% surcharge kicks in after that date ! I would condcede penalties and interest could be appealed but best to try and avoid having to appeal in the first place.

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RLI
By lionofludesch
25th Oct 2023 12:27

There's a fair chance the PAYE money will come back on its own.

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Replying to lionofludesch:
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By Wanderer
25th Oct 2023 12:44

Maybe eventually. I find though that you just get those letters advising you of the credit on the PAYE account of £10,000 & advising you to check your FPSs &, if all summitted okay, to offset it against the next PAYE lability, which is £5 per month.

I've always found an overpaid PAYE lability is the hardest to get back.

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Replying to lionofludesch:
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By rmillaree
25th Oct 2023 13:36

"There's a fair chance the PAYE money will come back on its own."

Since when ?? imho from experience unless you have specifically requested paye refund for known reason hmrc have historically kept held of funds and even when refund is requested they normally ask for reasons as to why overpayment has arisen ? things may have changed though perhaps?

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Replying to rmillaree:
By kenny achampong
25th Oct 2023 13:45

Zero chance of it 'coming back on its own' but we did actually have a CIS/PAYE refund very quickly this year, received on 4 May 2023. Previous year took 9 months to get back. And a decade ago, we would be chasing for a year or more, so for once HMRC have made an improvement. Not sure how easy it would be to get one back mid-year though.

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Replying to kenny achampong:
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By rmillaree
25th Oct 2023 14:09

received on 4 May 2023
wowsers - guessing you were ready to submit the claim the minute hmrc allow you to so probably right at the front of the queue

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Replying to rmillaree:
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By lionofludesch
25th Oct 2023 13:52

Yet we hear stories, on this very forum, of PAYE, lawfully due, being returned because it was paid "too early".

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Replying to lionofludesch:
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By rmillaree
25th Oct 2023 14:12

thanks for that it was just my experience that historically its been a nightmare to claim back overpayments generally. you could very well be correct in your assumption here. Would be just typical if the only time they ever refund automtaically is when they know amatyching liability will turn up - about as much common sense as ct services allocations (none!)

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Replying to lionofludesch:
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By JacquiMBurns
30th Oct 2023 13:30

Dream on.

My client used one incorrect digit in the sort code so it was paid into a PAYE account & it has taken just short of 2 years to get it transferred despite me giving them the details of the amount, the date & the paying in details by phone, email & formal letter. Each time I was advised they were putting out a chaser for it & each time it came back unfound. Why because they (at least 5 times) had sent the chaser out for the money using the details of where it should have been paid to rather than the details of where it HAD been paid to which I had given them. And yes, I had given them the reference number on the payment which was the VAT number.

I then wrote to them requesting interest on the next 5 VAT refunds which had not been paid out because they had set them against the payment which they had mislaid & got a response saying that the interest due on the last VAT return which HAD been correctly refunded to my client was £4.32, The amount they lost was over £66K. I am waiting till I calm down a bit to respond to this!

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Replying to lionofludesch:
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By lannera
25th Oct 2023 16:36

For two consecutive quarters our POA for Corp Tax were allocated against PAYE, even though they were paid to the correct account and also had the correct reference numbers for CTax on them. CT dept couldn't sort the allocation so had to go to PAYE to resolve - which they did, and then it happened again

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Replying to lannera:
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By Truthsayer
26th Oct 2023 12:26

I can't see any way that is possible. It rather sounds as if someone at your end got it wrong and won't admit it, or just doesn't understand that CT and PAYE are different.

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Replying to lannera:
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By Knight Rider
30th Oct 2023 12:28

Same happened to us. The PAYE helpline told us to speak to CT who directed us back to the PAYE helpline. After hours of waiting wrote a letter. More calls a few weeks later. Eventually got through to someone that sorted it.

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Replying to lionofludesch:
By Silver Birch Accts
30th Oct 2023 18:19

My recent experience of RTI is that HMRC will allocate enough money to balance the account and then move the rest to suspense, with no mention in the account. of the allocated amount The last thing HMRC will do is repay it.

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stonks
By WinterDragon
26th Oct 2023 10:18

We make sure to include payment details whenever we send a VAT return or P32 to a client so when one inevitable coughs up to paying the wrong one we can send them the phone number for HMRC wishing them good luck.

If they can't be bothered then it's billable time.

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By Plok89
26th Oct 2023 11:40

*OP UPDATE*
FYI client had made the payment by the VAT due date but was made aware of the outstanding payment once they received the VAT non payment letter.

I first spoke to the HMRC VAT helpline. Who advised they couldn't do anything and instead phone the PAYE helpline - sh*t (40 mins). Phoned up PAYE who could see the unallocated payment on account and have actioned this to be reallocated to VAT based on the date paid. This will remove any penalties. Advised this would be updated by the 2/11/2023.(30 mins).

Aware this is still not 100% resolved but was relatively straight forward.

Note to self/others - phone the helpline where the payment was made to first.

Thanks (3)
Replying to Plok89:
stonks
By WinterDragon
27th Oct 2023 12:30

Glad to hear you managed to get it sorted.

At least they've given a reasonable timeframe for it to get resolved as when I had a client overpay CGT on UK property it took 17 weeks for a referral to Income tax to get it refunded.

Hope it all goes through as planned and the client has learned their lesson.

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Replying to WinterDragon:
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By Plok89
30th Oct 2023 10:11

We've been waiting 4 months so far a CGT overpayment. Good to hear you finally got in resolved.

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Replying to WinterDragon:
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By Plok89
30th Oct 2023 10:11

We've been waiting 4 months so far a CGT overpayment. Good to hear you finally got in resolved.

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By Ammie
30th Oct 2023 10:45

Reading through the above it just reassures me of the dangers of poorly administered automation.

I do not find it coincidental that in some instances overpayments do not show on HMRC digital accounts and where the unaware would almost certainly lose the credit.

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By Knight Rider
30th Oct 2023 11:54

We had a CT POA payment allocated to PAYE despite using the correct UTR and bank details. Took a letter, some phone calls and a couple of months but HMRC sorted it eventually. Just waiting to see what date is used in the final computation.
Wouldn't it be simpler if we could deal with HMRC on e mail?!

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Replying to Knight Rider:
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By lionofludesch
30th Oct 2023 12:19

Knight Rider wrote:

Wouldn't it be simpler if we could deal with HMRC on e mail?!

Imagine how much spam they'd get.

Your email could be literally one in a million.

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Replying to lionofludesch:
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By Knight Rider
30th Oct 2023 12:29

They could have a spam filter.

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Replying to Knight Rider:
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By lionofludesch
30th Oct 2023 12:34

Knight Rider wrote:

They could have a spam filter.

Still don't think it's a great way to initiate a query. It'll just get ignored.

Conducting an existing enquiry with a specified officer - different kettle of fish.

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