Can anyone help please with a question on child benefit and the tax charge if you earn over £50,000?
DH had an unexpectedly good year of bonuses last tax year so for the first time ever had earnings over £50,000.
He had earnings of £58,000 and had employee pension contributions of £6,000 into a company pension scheme.
Everything I've seen says you take pension contributions off your earnings to work out the figure for your earnings for the tax charge.
This would be £52,000 after the pension so we expected to pay a few hundred pounds in tax.
HMRC say we are wrong and the full £58,000 is the right figure so tax of £1,700 is due - now and in one lump sum.
They won't explain why and they won't put it in writing. They just told him they are right we are wrong so pay up. It also doesn't help that their phone call to him was followed by a scam call just 3 minutes later saying that a warrant will be taken out for his arrest for tax fraud! Poor DH went into a right panic.
We've established the first call was HMRC. The second was a scam that has now been reported.
I'm guessing we have to pay which is horrible timing as DH will also be made redundant in the new year. I'd just really like to understand why everything I've read on the HMRC website says take off pension contributions but apparently that doesn't apply to him.
Would really appreciate it if someone more knowledgable could explain it! Thank you.