I owe my employer over 10k, due to being overpaid. HELP

[TomB95]

So in 2022 I received a 27% pay rise, and the month I received my first payslip with my new pay, it also had “car allowance £XXX on it”. However, I actually had a company car, so I though it was either the taxed amount I was paying for the company car or its was a way they were paying my pay rise.

but two year on it turns out the “car allowance” was not the taxed amount for my company car but was an extra amount being payed to me, on top of my new pay rise salary.

So, i was payed an extra £10,350 since June 2022, which I would have payed 40% tax on as my salary and company car would have already been over 50K.

has anyone had this happened to them and the employer wanted the money back?

i have been tax 40% and my student loan on the £10,350 so is there a way to get the tax back if I repay my employer back? As I don’t have that money!

I completely understand and it is only fair I repay them, however it’s a lot of money especially when I only got 60% of it actually in my bank account. We have talk about doing a monthly repayment plan, but I struggle to pay all my bills and out goings on my current salary.

😯 surely you won't have to pay it back unless you get the tax back. I don't know how it works but hope you get it sorted.

If it's deducted from your gross salary then your tax liability will be reduced.

I had this and it’s actually quite hard to work out. The firm will need to calculate it based on the tax etc. ask them to run the calculations etc and walk you through it, you shouldn’t be expected to pay all in one go but rather over an extended period etc

Did you not notice you were getting more than 27% more in your pay?

You'll repay the net amount - so minus the 40% tax you paid and you’ll get the tax back by paying less tax while you’re paying it back.

You'll get the tax back automatically if your salary is lower. Student loan repayments will be lower too. You can request an extended repayment period, eg ask for it to be repaid over 4 years not 2

@OneMoreTime23 I think i was getting about £200 extra a month more than I should have done. They never actually breakdown the figures, so I did no much more money I would get a month with a 27% pay increase so I just guessed it was correct on my pay slip.

Also, they have never told me how much tax I pay for my company car. I just guessed it was all right on my pay slip.

You should always be able to tally the gross figures though.

This happened to DH. They let him pay it back over 10 months and the tax sorted itself in the end. Pain in the behind but our fault for not checking the online payslips.

They will deduct it through payroll so your taxable pay is correct, meaning that you effectively just pay back the net amount to them of £6k or so.

I just want to chip in to suggest that you really check the overpayment figures. When I was on maternity leave, I was told that I’d been overpaid. When I went through it myself, I found that I hadn’t been overpaid at all. This was a public sector employer with no complicating factors whatsoever. I’m not suggesting that you haven’t been overpaid, just that you need to be satisfied that their sums are correct.

I find this a bit hard to believe. Whenever I get a pay rise I compare the new payment with a previous one. And not difficult to calculate what difference 27% uplift would make to the base salary before any deductions. Car allowance is shown as income so it would be pretty clear that getting that as well as an increase in base salary would be wrong.

Also pay slips generally break down the salary into earnings and deductions. So one side shows what you've been paid, the other the deductions.