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Taxcalc or HMRC problem??

Taxcalc or HMRC problem??

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Has anyone else had this and are using Taxcalc?

I have submitted about 5 2016 Tax Returns for self employed people so far.

On the Taxcalc return and on their calculations it is showing the class 2 NI as additional tax due. Have checked this and it is correct to my calculations.

However for all of the ones I have submitted something is happening between here and HMRC as I am getting a tax calculation i the post 'correcting' the return to exactly the figures I had in the first place.

Its not a problem apart from for the one who has received a refund which is too much by the class 2 NI.

Have emailed Taxcalc but wondered if anyone else has had this  issue?

Replies (14)

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By Tim Vane
20th Apr 2016 15:14

I'm not using Taxcalc but this issue has come up a few times already. The underlying problem seems to be that HMRC are defaulting to 52 weeks of Class 2 but many of the software providers are using 53 weeks. It is certainly a 53 week year for pensions, so it's not unreasonable. Given that commercial software has presumably passed HMRC's various tests, I suspect that HMRC are telling the software houses one thing and doing something different themselves!

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By paulhelliker
20th Apr 2016 15:27

On this problem, the class 2 NI is somehow coming out of the calculation on submission completely, not just one week. The one today received £148.40 more than they should have done....

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By SteveHa
20th Apr 2016 15:28

HMRC saying one set of rules for everyone else, and a different set of rules for them?

 

Surely not!

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Jennifer Adams
By Jennifer Adams
20th Apr 2016 18:51

Ask Taxcalc?

I've not submitted any returns yet - is this a sign of things to come I ask myself!

I'd contact Taxcalc - they are quite approachable

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By DMGbus
20th Apr 2016 20:44

NIC class 2 NIC week definition

I have seen an indication on one part of HMRC website (*) that the week for NIC class 2 starts on a Sunday - in the 2015-16 tax year there are 52 Sundays (x £2.80 = £145.60 as HMRC say currently as max liability for 2015/16).

However if the NIC week is assumed to start on a Monday, then you get 53 Mondays in 2015/16 (x £2.80 = £148.80 stated by at least three software houses).

Before we start saying that HMRC is wrong or that a software house (or three) is wrong we need a definitive answer as to the definition of a class 2 NIC contribution week - I wonder what the software houses think it is?

(*) In the 2011/12 contribution year the first class 2 NIC contribution week of 2011/12 is stated to have started on (Sunday) 10 April 2011 on one of HMRC's web pages.

 

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A photo of Mr Checkley
By steve.taxcalc
21st Apr 2016 10:06

Class 2 NI Calculation
Dear All,

Whilst there were good reasons to base the calculation of Class 2 NI on a 53 week basis (and it seems we were not alone in drawing this conclusion), it transpires that it should be calculated on a 52 weeks basis. Clients would be overcharged £2.80.

We have already been working on a fix to this. It’s currently with our Quality Assurance team and we intend to release within the next few working days. Your software will notify you of an update in due course.

For the future, HMRC have been developing an API (Application Programming Interface) that will enable software to fetch this figure directly from HMRC. We have already written code to make use of this but, unfortunately, HMRC have been delayed in bringing these new APIs to market.

Rest assured, we will continue to ensure that our software is accurate and well supported and we apologise for any  inconvenience caused.

Kind regards,

Steve Checkley
Director

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By DSP Financial Management
21st Apr 2016 11:26

Class 2 NI calc to week 13 (1st QTR paid)

steve.taxcalc wrote:
We have already written code to make use of this but, unfortunately, HMRC have been delayed in bringing these new APIs to market. Rest assured, we will continue to ensure that our software is accurate and well supported and we apologise for any  inconvenience caused. Kind regards, Steve Checkley Director
  Fetching this record from Long Benton whilst online, sounds particularly ambitious . . . . 

Thanks for this Steve,

I have not uploaded a return yet for 2015-16, and I presume there is an overide in the programme, since some clients, and I include myself in this posting, that were debited and have already paid for 13 weeks at £2.75, (the 1st Quarter),  the last 5 week direct debit having been charged to their bank accounts on 10th July 2015.

I think it is worth noting on this thread, and for networking, and much larger firms than mine, I also understand that there is an imminent fix for a minor glitch next week as well. So nothing to worry about.

Cheers

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By paulhelliker
21st Apr 2016 10:15

Thats great thanks.

 

I would reiterate that my latest issue has been that the entire class 2 NI has disappeared from the submission not just one week. This has as I said led to an over repayment of £148.40 which no doubt HMRC will issue a calculation for shortly......

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By John R
21st Apr 2016 11:57

To DSP

The DD payments to July 2015 were for 2014-15.

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By DSP Financial Management
21st Apr 2016 12:57

Yes, I have retrieved the document from Benton

John R wrote:

The DD payments to July 2015 were for 2014-15.

  Cheers also Tim V.

Park dated 12th December 14. The 10 July payment is stated as being for the period ended 11th April 15.

I can see a few of my client's contesting that they were not actually 4 months in arrears. Some will say that they paid Class 2 NIC on a voluntary basis, and were back dated to their business start date many years ago. Some of us here are old enough to remember the paper business start-up registration forms that triggered the class 2 liability. Did every firm keep scanned copies of these ?

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By JamesAnd
21st Apr 2016 12:01

I have had a number of these and it does appear from calls to HMRC that their computers are not capturing Class 2 properly for various reasons, as detailed above but also including where a client has claimed to pay voluntarily. I am getting calculations from HMRC ignoring the claim and showing no liability.

When I spoke to someone at HMRC they tried telling me to speak to somebody in the NIC department as it wasn't a self assessment issue. She eventually admitted that HMRC are only now beginning to train the call centre staff on the Class 2 changes. They are working through all staff attending two day courses. In the meantime, HMRC are gradually working on bringing in fixes and amended calculations will be issued in due course.

Regarding the Class 2 liability I use Sage and their notes on the relevant page within the software says put £148.40 on the return but HMRC have confirmed correct liability is £145.60.

And now I am also getting calculations showing a description of "minus marriage allowance" but adding rather than deducting. So obviously showing a higher balancing payment than what is actually the correct amount payable. Again, I was told that HMRC are aware of these errors and that amended calculations will be issued in due course.

 

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By Tim Vane
21st Apr 2016 12:07

@DSP - those payments were for 2015 (paid 4 months in arrears) and have nothing to do with the 2016 class 2 liability.

EDIT - distracted while typing this and John R's post beat me to it.

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By DMGbus
21st Apr 2016 14:02

HMRC class 2 NIC error current examples...

Client (L211) ceased to be a partnership member in Feb 2014 (2 years ago) - since then (eg. per 2014/15 SA return) only been an employee - but HMRC say  £145.60 class 2 NIC liability for 2015/16.

Client (W369x) became a partnership member in Dec 2015, and HMRC show a part-year class 2 NIC liability (that I expect is correct) - so far so good - actually no class 2 NIC error; BUT, despite being issued a UTR there is no notice to file a 2015/16 SA return.

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By daveforbes
21st Apr 2016 19:38

non registration

@paulheliker - Some of our customers have come across this situation also. Two almost identical returns submitted say with a £3000 refund due and transmitted from the software (and agreed by the gateway). 

Then when the actual payment comes thru one is for the correct £3000, the other for £3145.60 (i.e. clas 2 ni is being refunded on top of the calculated and transmitted repayment)

The reason for this apparently is that one of the tax payers had not registered with HMRC for class 2. Now IMO a more sensible approach would be for the HMRC to hang on to the £145.60 and send a letter saying "why have you not registered" or just register them automatically rather than refunding the money.

@dmgbus -- Regarding the number of ni weeks in this tax year - the definition of the NI week that we use in our calculations is http://www.hmrc.gov.uk/manuals/nimmanual/nim20200.htm

 

David Forbes

 

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