Under 18 and tax

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This is a very small amount of money in the grand scheme I am aware, but I am asking as I am not sure it seems correct! And it’s quite a lot to a student.

My DD17 worked a few hours in 2 jobs at the start of the year - both part time around college and min wage.

Way under the tax threshold - she was earning about £300 a month from both jobs.

Job 1 put her on furlough in April. She had last worked in job 2 in Feb/March and was unable to continue due to lockdown. She’s still on furlough and not going back to job 2.

She was sent a cheque directly to her by HMRC for under £20 this week for tax she paid via employer 2.

Employer 2 are asking her for this money as they say she owes it to them. Is this correct?

If so why would they send it to DD and not the employer. I need to look at her payslip (which she doesn’t have ) as I imagine she went on to BR tax code as it was a second job

No, she certainly doesn’t owe them the tax refund. If she was on the wrong code and getting taxed excessively, then the money goes back to her.

Was there some other overpayment or misunderstanding with employer 2?

Thanks

Employer 2 have asked for the exact amount that was the tax refund back, to the penny

I have asked for clarification but none has come yet!

I work in payroll.

Depending what her tax code was the employer deducts it from her wages and pays it to HMRC on her behalf. If she was due a refund (I suspect that as you said she was on BR for one job rather then her personal allowance being split between the two) then the refund is due to her, definately NOT the employer.

The only possible scenario I can think of is if they maybe paid her without putting her on the system first and forgot to deduct the tax from her wages but in that case it would be an overpayment of wages, not an overpayment of tax.

OK,

So maybe when she started they didn't realise she had a second job and paid her gross without waiting for her tax code to come through. Then when they submitted their RTI it showed they should have deducted tax at Basic Rate or whatever and so they, as an employer was liable to pay it for now. In which case she didn;t pay the tax n the first place the employer did so she has been overpaid and they are owed it.

But they would need to explain that to her properly with the correct figures IF that is the case.

Yes thanks I will check to see if she ever paid it herself in the first place. If not then this solves the mystery!