To be so annoyed at the tax office?

[sugaryouth1]

My husband has some unpaid tax to pay. It's 500 pounds. It's money we just don't have to hand. It's a lot of money so he rang them. After an excruciating wait on hold for over an hour we finally got the most unhelpful woman ever.
First the type of tax it is means he can't just pay it out of his wages, it has to be done via a bank transfer
Second problem is they don't take credit cards, only corporate ones. We have a credit card and while not ideal to use I'd rather it be stuck on that but no they don't accept them.
So we tried option 3. A payment plan of some kind. That was a flat out no.

So what the hell do we do? We don't have 500 pounds. We barely have 2 pounds once all the bills have gone out. Plus we've just received all our bills for the next financial year. Everything's gone up but our wages certainly haven't. We've already got to find an extra 150 pounds a month just to live plus our mortgage term ends in November.

So the call ended with a warning of it needs to be paid by April.
And no we didn't know he wasn't paying enough tax. It looked OK to us and it's not something either of us are very knowledgeable about.

There's literally no incentive to work or even try anymore

How much does your DH earn? If it’s over £50k you start to lose child benefit entitlement so could that be it?

I find them alright.

I think like most of these things these days it's hard to get to talk to a real person, and when you are feeling stressed that doesn't help at all having to hang around on the phone or talk to multiple automated menus before you can communicate with the person who can actually do what you want.

Are you sure this is a genuine letter from HMRC and not a scam?

Did you ring a number from the letter or the gov.uk website? If it was on the letter I think you need to Google it now and check if it was a genuine HMRC number or not

Make sure to go online and call the helpline number for HMRC given on the gov.uk website that you know is legit - not a number on any letter you have been sent - there are a lot of phishing scams out there based on HMRC. Not saying it isn’t genuine but being careful might save you falling foul of scammers.

I would urge your DH to set up a Government Gateway account and have a look at his PAYE online. That will quickly tell him what he owes.

Just reread the op.
Must be bank transfer????
(Cash in brown envelope)
Does sound a bit odd / could be a scam.

Yes I am wondering that now too, because it doesn’t make sense than a PAYE underpayment would be collected like this.

i am PAYE but also self-assessment as i earn over the threshold. I was on maternity leave last year and was on the wrong tax code - ended up owning £3.5k in underpaid tax in FY21/22. There was no option of payment plan and yes they only accepted bank transfer.

*owing

Could be a scam otherwise try speaking to Taxaid they can offer advice especially if you are on a low income.

taxaid.org.uk/

Hi - suggest you phone them back and ask to pay through your 2023/24 tax code. Keep trying - they are usually very helpful. Good luck!

HMRC underpayments

Their own page says that if you have received a P800 with an underpayment, it will be collected automatically as long as:

• you still pay Income Tax through an employer (i.e. your DH is still receiving a salary)
• you earn enough to cover the underpayment (is your DH's salary low?)
• you owe less than £3,000 (which it clearly is)

If you don't meet these requirements it should be either because your DH is no longer working, or his salary is too low to collect it. In either case, therefore, it would seem particularly insensitive for HMRC to not allow for further time to pay as you're the last people to have a spare £500 knocking around.

I am very surprised at HMRC's attitude on this. I know plenty of businesses that have been in receipt of very favourable payment terms from HMRC on much larger amounts of money.

Do try again OP. If you can, call 0300 200 3300 around 8am when they open, or around 7pm. It's normally much quieter at the beginning or end of the day.

Can’t say I’ve ever found HMRC helpful. Once I paid my final tax instalment a few weeks late due to an invoice not being paid, and they charged me interest on the entire amount, even what I’d already paid. When I rang to say I couldn’t pay on time they said “you have to pay on time”. What with was unclear.

HMRC are so shit at the moment, the staff used to be really knowledgeable but not so much now.

That's not right. They will only charge you interest on the overdue tax, not on what was paid on time.

Here's an example:

Tax due = £56,572, due on 1st February 2022

Payments - £45,000 on 28/01/2022, £11,572 on 04/05/2022

Interest charged by HMRC = £85.62 (actually made up of £88.09 of late payment interest and £(2.47) of interest paid for paying the £45,000 4 days early)

That I can't argue with!

Pay the £500 as soon as you have it. Put the bus passes and food on the credit card. Pay off the credit card the next pay.

The next month use the credit card for bus passes then say £200 food. Pay off next pay.

Repeat, reducing what you put on the credit card each month by whatever you can within your budget. As long as you pay in full every month then there won't be interest.

Dh had the same for the previous year and was able to simply have an adjusted tax code. I agree that it's either a scam, or the person on the phone may have got it wrong, either way I'd check before paying any money.

You could both join Prolific. I earn £40/mo just filling out studies for universities in my spare time. It means after a few months you’d be recovering from that £500 tax hit.

So after another hour on hold and I'm fairly certain speaking to every single employee of HMRC we have established it will come out of his wages from April and it won't even be noticeable. Apparently there's been a mistake in the letters and we aren't the only one ringing up confused.
Thank you so much for everyone's help!

Yes, apply for a 0% purchase credit card and put everything you can on that.

https://www.moneysavingexpert.com/credit-cards/best-0-credit-cards/

Apply for more than one if you only get a low credit limit on the first one.

Thank Goodness for that @sugaryouth1 Pity they couldn't tell you that the first time. It'll just mean a change to his tax code to recover it over the next tax year

When I had this. I was told that you could only set up a payment plan once it was overdue.