Plunged back to brokesville again....

[happyclapper]

Being 2yrs into a DMP we are just beginning to find our feet again following DP 2 redundancies since birth of DS2.
Thankfully DP now has a good job and has had a couple of payrises which has meant changes to his tax bill.
Inland Revenue have changed his tax code several times and yesterday they sent us a letter saying he has underpaid by £5K.
They intend to change his tax code next April to claw this back but I have visions of us living with the no spare money again after bills are paid and I just can't bare going back to that again.
Has anyone been through this and how much can they take extra each month.
DP is away at moment so can't get to speak to tax office untill next week.

I'd recommend he checks how they've arrived at that figure and also his tax-code with his payroll team very, very carefully as my experience with HMRC & tax codes is that mistakes are not uncommon. I would also recommend that he considers submitting a self-assessment tax return for 2011/12 as I've found that helps keep problems to a minimum. £5,000 in underpaid tax is a very large sum and, if his salary package is fairly straightforward and PAYE, it's pretty difficult to run up such a big discrepancy.

Thank-you CEO. That sounds quite reassuring. Will get him to question it very carefully.
You are also right, as he is PAYE it is a bit much that they have made the mistake over what must be a considerable time and then we have to suffer for it.

The onus is always on the taxpayer to make sure that they are paying the right amount of tax. However, because the tax system is complicated and taxpayers are not tax experts, there is also the 'reasonable' test. If you get a tax-code from HMRC and you've been up front about your earnings, you can try to argue that it was reasonable to assume the tax-code was correct. Doesn't always work but worth a shot.

Even though my earnings are PAYE and not very complicated, I submit an annual self-assessment return online just so that I am confident I don't owe them anything. I started doing this the year I got a hefty great tax-bill rather like your husband. I can highly recommend a product called 'TaxCalc'... costs about £20 a year, leads you through the process by the hand and, for me, it's worth every penny.

I am paying back a £5900 underpayment of tax (their error). They are taking back £50 a week. That's a lot of our money gone