Tax Underpayment - anyone had this particular experience??

[BunnyLebowski]

Have posted this in Chat too hoping for more replies but no luck so far. Can anyoen here help me?

I've received a P800 saying that for the Tax Year 07/08 'I had two employments at the same time and both employers were applying a PAYE code giving the full tax free allowances' and that therefore I need to pay them back £400.

I only had one job in that year. I started it as a temp through an agency and was then, after 5 months, given the job permanently by the company.

I spoke to HMRC this morning and they say that the Tax Free Personal Allowance I was given in the first half of the year (when employed by the agency) was then given again by the company once they took over my contract (Apparently they didin't use my P45 info correctly).

Obviously as an employee I assumed that the company had dealt with all this in the correct manner.

HMRC are sending me out all the information. They say I can then appeal the decision.

Where do I stand? If the mistake was made by the company am I still financially liable? Should I contact either of the employers asking for info? Oh and has anyone had experience of appealing these things?

Apologies for rambling. Any advice you could give me will be gratefully leapt upon.

And to make you all want to give me a slap I don't have any letters/P45s for that time blush sad. Will that go against me?

I think that as you are responsible for making sure you've paid the correct tax you will be liable for paying it back. If your employers had overpaid your tax I'm sure you'd expect a rebate?

Unless you have given false information previously, you can probably appeal successfully against this.

To answer your questions:

If the mistake was made by the company am I still financially liable?

No you are not. It is the company's responsibility to operate PAYE correctly - HMRC says in its own procedures 'PAYE under-deductions are legally an employer liability unless HMRC directs that the individual should pay.' More information about this here.

Should I contact either of the employers asking for info?

No, HMRC must send you all the details of their claim which you can then defend.

Note that your case is going to be significantly weakened if you filled in and signed a P46 form to say 'This is now my only job and I have not had any other job since 6st April' because that would have been your error, not your new employers.