to think that expecting people to repay £1500 tax on average because of a computer tax blunder is unfair and ridiculous?

[arses]

I work in the NHS. I have worked in the same department since 2002. However, due to a crazy payroll system, I get three separate paychecks for the work that I do.

If a tax bill lands on my door on Tuesday for 'underpaying' tax - when, as far as I know, I have diligently paid my dues since beginning work, should I really be expected to repay the government when if I had made the mistake, I would also be expected to repay?

On maternity leave, I asked HR to find out what my salary would be in the event of a reduction of hours due to flexible working. They told me that with my separate contracts, it was 'too difficult a calculation' and they wouldn't be able to tell me my salary. But I should have known that I was being overpaid or was being underpaid?

And it won't even have a silver cloud like repaying the deficit, will it? Because if I am an underpayer in this equation, it will go into an overpayer's pocket?

They'd still get it wrong........ye of little faith and all that.

But if people had any idea how fragmented and how much of a hard job the govt find it to pay state employees correctly, even though they make the rules, know the bands are reminded etc, I am not suprised they can get tax wrong for loads of others.

Sorry Emmy, I was going with what the BBC said and they were obviously misinformed. I did look on the hmrc website for a press release earlier so I didn't have to rely on the media getting it right, but couldn't find one.

Gotta love how they release this info last thing on a Friday. You'd think they didn't want to talk about it!

I would sack the business analysts and testers of the previous system ;)

I file every year (even if it is just a one page update of my non-taxable income) and have not been let down by HMRC yet.

Emmy, I don't profess to understand the complexities of public sector payments, but I would have thought HMRC (which calculates the tax code) is a separate entity from the public sector employer (who applies the tax code).

I assume a public sector employee gets their P60, maybe in OP's case, 3 of them (?) because of 3 paychecks. When filing the tax return, she would add up the gross income, net income, tax deducted for the 3 P60s and send to the HMRC. This is in case something gets loss in translation at the employer level because of the 3 lots of income. From there, is it a piece of piss for the HMRC to apply the usual tax tariff to total income - I could work that out myself. HMRC then based on that adjusts the tax code. The tax code goes back to the employer(s) which simply applies it to the pay going forward.

All is squared and comes out in the wash.

According to the expert on Radio 4 this afternoon, anyone getting a demand for underpaid tax should check it to make sure that it is correct, and should then claim exemption A19 - which states that if the Inland Revenue had all the relevant information, and if you had no reason to believe that your tax was wrong, then they should waive the repayment.

The above will work under exceptional circumstances and may not even be considered depending on the arrears outstanding.

So let me get this straight SDTG, this money is due, it's owed to HMRC, are you saying that others who have met their tax obligations, should cover shortfall for those who haven't paid what they should have (mistake or otherwise) and now don't want to.

The money has to come from somewhere - Why should everybody else pay it?

Arses, I see your point in your last post, but you thread title states that it's unfair and ridiculous and I think YABU because I don't see it as being either of these.

What will be unfair is for those who paid the right tax, to then have to pay more to make up the shortfall.

The fact that this would happen was in all the major papers months and months ago; I clearly remember reading it. Why if this is the case, did people not think to check?

What about personal responsibility FFS?

And I've worked in both the public sector, the private sector and a combination thereof and so know what it is like to be paid from more than one source

Exactly bluehoes. A little effort goes a long way. How many people actually sit down they get their P60's and take a look to see if things seem ok?

And don't give me this lark about being shit at maths either. I lived in Canada for 10 years and their tax system is one of self-assessment so everybody (from illiterate manual workers to highly-paid CEO's) have to file income tax returns and sometimes you owe money at the end of the year, sometime you get it back.

If you end up owing too much one year, you adjust how much tax your employer takes off and you make sure it doesn't happen again.

Deakell - the rights and wrongs of it are for people's individual consciences and circumstances. I merely felt it was a good idea to let people know about this, as the tax expert had recommended it.

Anyone know how it has gone wrong? Most people on PAYE have the same basic tax code then pay the correct amount on earnings above this threshold. Watched the news tonight but it didn't explain anything.

Also people in receipt of tax credits have had this overpayment situation for years. You declare your income for one tax year then they pay you tax credits based on this, then you declare your earning for the next year and they say you've been overpaid!!!! So reduce your tax credits. Not a great system when a household has relied on a certain amount. So if they have got it wrong then the same system should apply to everyone.

I'm baffled as to how it's happened as I prepare salaries for 50+ employees.

The money recouped by this will be a tiny fraction of the amount lost every year to HMR&C by wealthy tax dodgers and corporate tax avoidance strategies.

Yet HMR&C is currently offering an amnesty to offshore account holders meaning that they can get away with paying way less than they should in exchange for coming clean about some of the money they've squirreled away. Entirely coincidentally, much of the current cabinet is independently wealthy and have very wealthy friends. Funny that...

Totally agree Snorbs but they are still happy to claw back £20 a week from family income via tax credits even though we give the correct information and it's all worthwhile administrative cost wise.

Is it really a tiny fraction? I would say go after both lots.

Corporate tax avoidance (as opposed to evasion) is perfectly legitimate though and it is almost impossible for high earning persons on PAYE to dodge tax.

On the issue of overpayment of tax credits, to avoid the errors in an inherent in an overly complex benefits system, I have a lot of sympathy for IDS' proposal to dismantle the current system and simplify it into one of universal benefit.

Tax evasion actual evasion is a huge problem, I do believe it costs more to this country than benefit fraud.

Yet it dosen't seem to be a priority as it tends to be the very rich. I can see why this will piss people off as according to the news it's likely to be the poorest hit. As in those who have more than 1 job, payments in kind etc. Sure there is personal responsibility, but you should have faith in the tax office and not everyone can work this stuff out.

But like I say lets see how long it takes those owed to get their money back vs how quickly they start the grab back. I bet you the latter will come around a damn sight quicker.

I have to say the HMRC have always been reasonably prompt in refunding me any excess tax that I have paid.

They write to inform me (after I have filed my return) and then it goes into my account. I have not had to chase or anything like that.

If it turns out you are owed money from the tax year 6th april 09 to 5th april 10 you will be ensured of getting it back by 31st Jan 11 by filing a tax return as all monies due from these tax returns are due on or before 31st Jan and are subject to interest if late. This applies to both HMRC repayments and payments from private individuals.
DH overpaid by nearly £3000 in the 08 to 09 year and the money popped into his account on 29th Jan this year.

Tax avoidance is not illegal.

It's called being as tax efficient as you can. PAYE is not the easiest way to sort out tax, because the UK has never (to my knowledge although correct me if I'm wrong) had a system of self-assessment.
SDTG- fair enough you reposted information you've been given. NOthing wrong with that. My guess is many people, even if they stand to reduce what they owe by completing this form, will be too lazy to look into it anyway because nobody else is doing it for them.

I have a fabulous accountant who minimises my tax burden legitimately! Key word their is avoidance - this is not illegal.

Tax evasion, different story really - they are criminals and should be made to pay with fines on top.

But don't confuse the two.
Presumably an amnesty is being offered because they stand to get more money this way. Why else would they do it.

Working a saturday job and not delcaring it is tax evasion. Claiming benefits and not declaring cash in hand work is tax evasion and benefit fraud too.

Keeping in mind the very rich and/or big business owners who can minimise their tax obligations legitimately, are probably also still paying a lot of tax and employing a lot of people.

key word there rather

If the problem has been created over 4 years then surely they should take it back over 4 years.
Over £100 a month minimum could cause real problems to some people.
Imagine if two years ago you were injured and now can't work yet you're suddenly expected to pay back from four years ago.

I hav eno problems paying back what you owe but they need to do it in a way thats not going to cause people major problems

I have missed this news and am getting a bit worried. I can't seem to find it by googling so can anyone link to the story please?

That's my point Bronze, luckily DH is in a well paid sturdy job, so it wouldn't be an issue and we are not in the probable affected criterea anyway.

THose that are though are more liekly to be those that need 2nd jobs etc, who probably cannot afford to lose over £100 a month if it's taken back over a year as it is being suggested.

Deakell I know the difference between tax avoidance and tax evasion after helping get an old employer done for the latter, I'd have more sympathy if the tax office were more pro-active in getting these funds back as it costs more to this country than benefit fraud.

www.thisismoney.co.uk/tax/income/article.html?in_article_id=513580&in_page_id=77&ct=5

Look on the bbc website hocuspontas
news.bbc.co.uk/1/hi/business/8501037.stm

old story from back in feb

check your tax code, should be 647L

Under most circumstances that is. If it's not the above code, you should find out why.

Yes Emmylou, I'm sure you do, clearly you do. But others won't so it's worthwhile clarifying for them

Thanks for the links. Completely seperate from this - I realised my tax code was wrong a few weeks ago. 537L instead of 647L (for 5 years!) and the tax office have now amended it. Hopefully I will be due a small rebate and not be asked for more money!

How can it be a computer's fault? The computer only does what its told by a human.