Can I appeal tax code?

[Dereksmalls]

I have just received a letter from HMRC to say my employers will receive a new tax code for 04/12-04/13 which assumes my income will be so high that I won't be eligible for any personal allowance.

The reason for this is to do with the settlement of my DF's estate which took several years and included an accrued sum which was eligible for income tax. However, this was a one-off and normally my income is well below this.

I do now have some income from a source seperate to the wage from my employers but my income this year will be well below the threshold where the personal allowance disappears. I'm concerned because I think this means an additional £3000 will be deducted from the two wage payments I will receive before the end of this tax year which will be a massive chunk out of my take home pay.

Because I have seperate income I also made a payment on account this year. The estimate was done with the help of my accountant and we used realistic figures. I have to make a second payment on account in July.

So- I have a couple of questions that I'd really appreciate do help with:

1. Can I appeal my tax code and how long does this take?
2. When making the second POA in July, as it is after the end of the tax year it should be apparent what my actual income is, therefore do I still have to work under the assumption of the tax code i.e. I am not eligible for a personal allowance even though my income is clearly to low for this or can I reduce the POA amount accordingly to take into account the overpayment?

I don't really want to get my accountant involved as there would be fees involved whereas I presume the current worse case scenario is I'll receive a rebate when I submit my tax return next year. However it's going to be a big hit in the short term that is going to be difficult to manage.

Thanks

1. Yes you can object, details should be on the letter. If you have appointed your accountant as your agent you should do this through him.

1. Complete your tax return prior to 31 July and then you will know exactly how much is due for 2012/13 and how much has been paid through PAYE and can reduce the payment accordingly.

1. Many accountants work on a fixed fee basis partly because it is better client service, but also because it is better not to have a client that doesn't tell you what is going on because they don't want to be charged every time you answer the phone!

Thanks so much! I had a huge bill last year as the way my DF's estate had been dealt with by his executors was pretty messy and very time consuming for the accountant. I did have a fixed fee this year but it then was expanded slightly and I would be surprised if I wasn't charged for this too. Last year's bill has scared me slightly!

AFAIK you can contact HMRC yourself and advise them of your expected income for the current year and they will adjust your tax code accordingly. So if you advise them that you wont receive that income, they should remove it from your coding.

Hi, in short yes you can. You can do it free yourself. You can phone and explain your situation to them and they may say send a letter in with your paperwork they may not.
Your rate is made up on the assumption that you will be getting the same amount which you are not.
Appeal but also check that you have not over paid. I did and was shocked to find that over a 9 year period I had been overcharged a grand total of £4560 even though I had phoned and questioned them at the time.
Good luck.