Following the introduction of the new dividend tax I am getting several clients asking me to look at their tax codes which appear to have been replaced by K codes and deductions rather than allowances. I am having trouble seeing where the figures actually come from, and am wondering if anyone else is seeing this issue and can help. Wondering whether there might be an underlying issue with a possible withdrawal of pension tax allowances (possibly to be announced in the budget?) Any ideas? Or am I being thick?
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Broken RTI / PAYE codes system
I can see the "bottom line" code K1144 for a client (via online services PAYE for the employer) but when I look for a breakdown of the director's new code under Self Assessment onlline services thius is what I get:
PAYE coding notices for tax year 2016/17
There are currently no PAYE coding notices available to view for the tax year you have selected.
So far, in past month, this has happened twice. In the first instance the client had to scan his personally received at home PAYE code and eMail it to me (and it was found to be incorrect). Phone HMRC SA helpline and code got put right quite quickly, new code issued but like the old code the new code not visible in SA online (Most recent tax code viewable for client is an Auguist 2015 one for 2015/16).
So new tax codes go to the employer but not the client's agent?
Is this part of HMRC's philosophy / policy of trying cut agents out of things? Or a policy of using cheap incompetents for maintaining and running it's IT systems?
I had my tax code sent in the post. No notices in my SA login account. There was a leaflet to view code by creating a new Digital Personal Account which I did and the detail of the tax code calc is in there.
It's still wrong though with an amount of c. £900 untaxed interest being shown as a deduction and no sign of the £1000 saving allowance. £900 was approx what was declared as taxed interest on my last SA. Untaxed was nil.
The dividend calc looks about right based on prior year.
As the employer my limited company has not received a notice yet so I'll be using 1100L for my payroll.
Rang HMRC and they hadn't got a clue what was wrong with the interest coding but acknowledged it looked wrong. I await their response!
Best one so far
A client has been sent a code of K19217, which means £192,184 will be added to the pension that is being taxed. That pension is only £65,000. The notes refer to an adjustment to rate bands of £182,103. I'll see what HMRC have to say.
Let me guess .....
A client has been sent a code of K19217, which means £192,184 will be added to the pension that is being taxed. That pension is only £65,000. The notes refer to an adjustment to rate bands of £182,103. I'll see what HMRC have to say.
50% tax deduction ?
Agent help line
I usually get an opportunity to say something amusing but on answering the guy immediately said "oh dear" and amended the code. He did not wish to join in the banter.
Busy
I usually get an opportunity to say something amusing but on answering the guy immediately said "oh dear" and amended the code. He did not wish to join in the banter.
He's probably very busy at the moment.
coding adjustments
HMRC have told me in a phone call that you can not extend the basic rate band for gift aid or pension contributions to cover the new dividend rate. I am sure that my client is not liable to higher rates but HMRC are adamant that he is.